Setanta nears the final whistle

Setanta bought valuable time for itself yesterday to prevent it entering bankruptcy. However a rescue plan is still some way off and the reprieve was due to arguments among shareholders, who are in dispute over the company's future.

The sports broadcaster is owned by private equity groups Balderton Capital and Doughty Hanson, who between them hold the company's fate in their hands. The company's chairman, Sir Robin Miller, is thought to have raised around £50m of the £100m needed to keep it going and its owners must now decide whether they want to provide the remainder of the funds.

Setanta's problems started when it lost the rights to air over half the Premier League football matches it previously broadcast. It currently shows 46 games every season but that number will drop to 23 in August next year. That will mean an exodus of subscribers. Already down to 1.2m, it is calculated that as many as 1.9m are needed for the company to break even.

As a result of its troubles Setanta is currently trying to renegotiate its deal with the Football Association. It is due to pay the Barclays Premier League £35m this week and is already  believed to be late with a £3m payment to the Scottish Premier League. It also owes money to Indian Premier League cricket and Premier League Rugby.

If the broadcaster does collapse it could just be the start of problems for sport in the UK. Rights will revert to the sporting bodies themselves but with broadcasters short on funds they would be unlikely to achieve previous levels.

WHAT THEY ARE SAYING
Marc Sugarman, an analyst at Citibank, in the Guardian: "We estimate that Setanta pays around £85m annually for SPL, FA rights, boxing and US PGA rights. We would expect these rights costs would more than halve [and] possibly fall by two-thirds."

Claire Enders, of Enders Analysis, in the FT: "I really think this new management, which has been in for only six weeks, should be given time to come up with a solution, because I believe there is a solution, but it doesn't look like they will be given that time." ·