From David Del Valle in Madrid
Mediapro, which holds the rights to Spain’s Football League and controls commercial channel La Sexta, is seeking bankruptcy protection for its subsidiary company Mediaproducion and has requested a formal suspension of its payment in the latest round of a football rights war with Sogecable, owner of Digital Plus and Cuatro.
Difficulties in meeting its financial commitments, which amount to E2.58 billion in football TV rights up to the 2014-2015 season, are behind the decision, according to the company. The main creditors are the Spanish football teams and Sogecable. Last week Sogecable requested the Court to force Mediapro to pay it E105 million for a breach of contract going back to 2006.
The CEO of Mediapro, Jaume Roures, pointed out that the bankruptcy move is aimed at defending Mediapro against Sogecable. Mediapro blamed its inability to meet its near term commitments on Sogecable’s not paying E90 million owned by June 15 for rights to air some matches from the first half of the 2010-2011 soccer season on its pay TV channels Canal Plus and Canal Plus Liga.
“The decision to request suspension of payment does not cast doubt on the profitability or viability of Mediaproduccion SL, [the request] has been motivated solely by the decision of Sogecable to not meet its payment obligations,” the company said in a statement. Mediapro also threatened to take legal action against its rival for damages.
For its part, Sogecable has accused Mediapro of blocking payment of the E105 million and declaring it would pay up for the season when it had a guarantee on this money.
Mediapro owns most of the professional league’s broadcast rights including the rights to Real Madrid and FC Barcelona. Mediapro airs games on its free-to-air channel La Sexta and its successful pay DTT channel GolTV. Sogecable broadcasts one match on its pay channel Canal Plus on Sunday nights and airs other games on Canal Plus Liga.
Mediapro was forced to re-sell certain football rights to its rivals after the regulator, CIC, found its original exclusive deal anti-competitive.