Setanta chiefs net millions in US sale

THE two founders of the broadcaster Setanta Sports have netted millions from the sale of a stake in the company to an American investment firm.

The Irish Examiner has learned that America Insurance Group (AIG) has bought a minority stake in the sports channel.

The company would not disclose how much the company’s founders Michael O’Rourke and Leonard Ryan will earn from the sale, but given the size of Setanta, the figure could be in excess of €10 million.

The AIG investment was made through its New York-based Grobal Sports and Entertainment Fund and the full details are expected to be released next month.

The deal will cap a huge year for Setanta, which plans to launch the country’s first Irish sports channel next year. The station will broadcast on NTL seven days a week, showing Premier League football, Celtic League rugby and the Formula One championship, poached from RTÉ.

In February this year, the company surprised many in the broadcast media when it won the exclusive contract to show the Scottish Premier League football (SPL). The four-year deal cost Setanta an estimated €50m, but it will recoup the money through pay-per-view subscriptions and advertising revenues. It also has plans to set up a television channel for Celtic and Rangers football clubs.

It has also netted a number of other broadcasting agreements this year, including the rights for World Wrestling Entertainment in Britain and Ireland.

Setanta employs more than 70 in offices in Dublin, San Francisco, Sydney, Glasgow and London. It is believed to have annual turnover in the region of €60m and is profitable. It started life replaying broadcasts of GAA, soccer and rugby to the US, Europe and Australia.

It has made a number of other investments in media companies in recent years, including a 20% stake in the Dublin talk radio station Newstalk106. Setanta is also an investor in the online broadcaster Servecast.com, along with Denis O’Brien’s Island Capital. Servecast lost €1.9m in 2003, according to its most recent results.

It was reported earlier this month that Setanta sold its television production arm to a team led by Mick Pilsworth, the former chief executive of Chrysalis Television, for around €2m.

Group accounts for Setanta Sports Holding Limited, which AIG is investing in, were not available at the companies office. It is not known if AIG will be represented on the board of Setanta.