ESPN says it has no plans to buy Setanta
Disney-owned sports network scotches media rumorsLONDON -- Walt Disney-owned ESPN on Thursday dismissed speculation that it was poised to swoop on ailing Irish sports channel group Setanta Sports, saying it had no plans to acquire the cash-strapped programmer.
"We currently have no plans to buy Setanta," an ESPN spokesman told Reuters in response to days of speculation that it was preparing to take over the premium sports channel business that is battling bankruptcy.
"There are a lot of stories out there that link ESPN with a possible purchase. We wanted to set the record straight," the spokesman said.
This week, BSkyB chief executive Jeremy Darroch also said the satcaster had no plans to bail out the Irish channel group.
Setanta has been locked in last-ditch refinancing talks with its private equity backers, including Balderton Capital and Goldman Sachs, and is thought to be seeking a buyer for its U.S. and Irish assets.
The group defaulted on a £3 million ($4.9 million) payment to the Scottish Premier League last week and is not expected to be able to meet a further payment to the English Premier League of about £30 million ($49 million) that is due next week.
Founded by Irish entrepreneurs Michael O'Rourke and Leonard Ryan four years ago, Setanta has suspended new customer signings, but has urged existing customers not to cancel their monthly payments.
If the company folds it is likely that its key program rights, which include Scottish and English Premier League Soccer, U.S. PGA Golf and Guinness Premiership Rugby -- will revert back to the rights holders and be sold off again -- potentially at a knock-down price that would favor its competitors, analysts said.
"If Setanta fails, we would expect Sky to acquire some of its rights to consolidate its sports offering," said an investment note from UBS analyst Daniel Kerven.
But he warned that if Setanta failed then Sky would lose its main competitor on the sports rights market here -- potentially opening BSkyB to further regulatory scrutiny.
"While this should have longer term benefits for Sky, it may result in higher costs near term as it acquires additional content and could increase regulatory risk ahead of Ofcom's final pay TV market consultation."