Setanta raises £90m war chest

By Juliette Garside

Setanta Sports, the Irish broadcaster, has raised an extra €130m (£90m) to finance its assault on BSkyB's dominance of football coverage.

The funding has come from a share issue to existing backers - including Doughty Hanson and Balderton Capital, the private equity firms, and Goldman Sachs - and will be used to pay for rights acquisitions such as next year's deal to show England international and FA Cup games.

A number of senior executives have taken shares in the privately held company for the first time. More than 20 per cent of Setanta is owned by its founders, Michael O'Rourke and Leonard Ryan, and their management team.

Richard Brooke, Setanta's corporate development director, said: "This is our war chest." The company is running at a loss of tens of millions of pounds a year after taking its fight to Sky this summer by bringing live Premier League games to digital terrestrial viewers.

Subscription revenues are not yet sufficient to finance new rights deals. Prices have been slashed and contracts shortened from one year to one month as Setanta works to grow its premium sports audience in Britain and Ireland from 400,000 to 1m by next summer.

The company hopes to break even by mid 2009 but could face competition on digital terrestrial from next summer as Sky is lobbying for permission to launch a pay-TV service to Freeview customers.

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