Investment house Benchmark Capital Europe has spent more than €30 million taking a stake of up to 32 per cent in the Setanta Sports group, the Irish-owned TV sports broadcaster.
The privately-held company said for the first time yesterday that it plans to bid for rights to broadcast British soccer Premiership matches when they come up for renewal.
In a ruling expected shortly, the competition body in the European Commission is widely tipped to call for sale of blocks of rights in tranches instead of bundling all the rights in one deal.
Such a ruling would remove BSkyB's monopoly over the Premiership that it holds until 2007, clearing the way for the auction of rights to rival broadcasters. Bidders are likely to include the BBC and ITV.
Setanta said yesterday that it will use most of the money raised by Benchmark to take part in an auction process that is widely expected by the broadcasting industry. This means that its co-founders and joint chief executives, Leonard Ryan and Michael O'Rourke, will not be using the Benchmark investment to cash in on some of their own shares in the company. They remain controlling shareholders in the company following the deal.
The broadcaster said the Benchmark investment valued its operations at a sum "in excess of €100 million", but it declined to specify how much. It said only that Benchmark had taken a "significant minority stake" in the deal.
However, the private equity company is understood to have taken a little more than a 30 per cent stake in the broadcaster. Setanta's own assertion that the investment valued the company at more than €100 million implies a value of more than €30 million on the deal.
"This investment will enable Setanta to grow its international sports broadcasting business and give the group access to capital to build its rights acquisition, channel distribution and subscriber marketing opportunities," said Mr Ryan and Mr O'Rourke.
The arrangement was led on the Benchmark's side by its general partner, Ynon Kreiz, who has joined the board of the company. "This acquisition is part of our strategy to expand our investments into the international media sector.
"The investment in Setanta Sports will further help the company compete both internationally and in its home markets of the UK and Ireland."
Setanta employs 150 staff in seven channels with operations in Dublin, London, Glasgow and San Francisco. It has an Irish channel on the NTL platform, broadcasting GAA, the Scottish and English soccer premierships and Formula One motor racing.
Two of its channels in Britain on the Sky platform broadcast Scottish soccer and premier league soccer from France, Italy, Germany and the Netherlands.
It also owns Celtic TV and Rangers TV. It has a channel broadcasting European soccer and rugby in the US and another channel that broadcasts US sports into Europe.
