Wednesday, June 3, 2009

crumbling Setanta ready to drop on SPL

With Irish broadcaster Setanta tumbling into deep financial crisis, all Scottish Premier League clubs are facing some highly turbulent days. At present Setanta owes the SPL its final £3m installment but given the companies crumbling business, unless it works out an arrangement with another broadcaster or receives an inflow of capital not only is the final payment for the 2008/2009 campaign in jeopardy but next years £25m fee as well.

Setanta has until next Monday to pay the amounts owing before going into formal default. Should this occur, each SPL will be faced with some highly problematic cash flow situations and financing credit lines are likely to be tightened considerably.

While this problem is shared by all Scottish Premier League sides, the Gers face a number of balance sheet woes that must be dealt with. Should the existing broadcasting contract go into default the Rangers will likely need to expedite cost cutting measures.