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EPL Can Teach NBA All About the Joys of Bankruptcy

You'll recall that yesterday in discussing the proposed marketing tie-up between the NBA and the English Premier League, one of the supposed benefits the NBA would get from the deal was help in learning how to diversify its ownership, particularly with international owners. Well, it now looks like the EPL can teach the NBA how to deal with owners who have come into the fold through foreclosure, as a consortium of international banks will soon be in control of West Ham United. Iceland's former billionaire, now broke, financier Bjorgolfur ­Gudmundsson will be giving up control of the club to the consortium which are the major creditors of the Icelandic bank Straumur and will put the club up for sale.

Also up for sale is the storied club Newcastle United which has been relegated to the Championship for next season, marking its first season out of the Premiership since 1993. While the loss of the television revenue which accompanies a spot in the EPL will depress the price, the club draws very well, and an owner with patience should realize an excellent return once the Magpies return to the EPL.

The last major financial problem surfacing for the EPL over the weekend is the impending bankruptcy of pay television broadcaster Setanta, which holds a portion of the EPL's television rights. This is something that the NBA isn't likely to have to face, given that its rights are held by Disney and Time Warner, but in the current economic climate you can never be sure of anything anymore. In any event, it looks like it is increasingly likely that a portion of the EPL's broadcast rights may again be put up for bid, which will benefit the BBC and may depress the price to the Premiership as there will certainly be far less competition. Fox, in the guise of BSkyB, may be prohibited from bidding due to European antitrust rules, as it already holds the other portion of the rights. ESPN could be a player, in which case the price may stay as high as it originally was.

Full post as published by Sports Biz on June 08, 2009 (boomark / email).