Setanta in financial trouble

TV co. must pay Premier League at week's end

LONDON — International sports paybox Setanta is on the brink of financial meltdown.

The Irish company, which broke BSkyB’s monopoly of live coverage of English Premier League soccer in the U.K. in 2006, must persuade its private equity backers to stump up more coin or go into administration, the equivalent of Chapter 11.

Setanta must make an outstanding payment to the Premier League of about £40 million ($64 million) by the end of the week. It recently failed to pay $4.7 million to the Scottish Premier League.

The paybox, which built its business on showing sports events to expatriates, forked out $624 million for the English Premier League matches but failed to break even on the deal.

The economic downturn exposed the fragile state of Setanta’s finances — its losses are thought to be running at $80 million.

If Setanta fails to meet its obligations to the Premier League the rights to the 2009-10 season are expected to return to the league to be sold on to the highest bidder.

A favorite to buy the rights is Disney-owned ESPN, which has been beefing up its European activities.

Setanta is also believed to be in talks with other sport bodies, including the U.S. PGA golf tour, over its financially precarious position.

The writing has been on the wall for the sports paybox since February when it failed to retain its packages of English Premier League rights after being outbid by BSkyB, Blighty’s largest paybox.