Rugby League's TV deal

[Toads]

Nine saved from administrators: report

Peter Trute, AAP Senior Finance Writer
AAP
October 16, 2012 6:00PM

THE Nine Network has reportedly staved off administration, with lenders agreeing on a debt-for-equity deal where two US hedge funds and investment bank Goldman Sachs will take a stake in the broadcaster.

Nine has not confirmed the deal but the Australian Financial Review reported on Tuesday afternoon that the lenders had reached an agreement on the $3.3 billion debt that threatened to cripple the network when repayments fell due in early 2013.

Negotiations are still expected to continue on Wednesday.

Earlier on Tuesday, Nine chief executive David Gyngell told reporters he was "quietly optimistic" about the network's future as he left a crucial meeting in Sydney between Nine's lenders: hedge funds Apollo and Oaktree, and investment bank Goldman Sachs.

If Nine is unable to secure an agreement among its lenders the network faces being placed in administration because it would be unable to service its debt.

As Nine's lenders continued negotiations on Tuesday, the National Rugby League (NRL) said its $1 billion broadcast rights contract, signed with the network and pay TV provider Fox Sports in August, was not affected by the debt crisis.

"The issues that Nine needed to address in terms of its funding were something that were discussed during the negotiation process," NRL media and communications director John Brady said.

"It's not unexpected that they have to go through this issue."

Fusion Media analyst Steve Allen said that to date the Nine Network had not suffered any brand damage, however being placed in administration might force it into damaging advertising rate cuts to resecure advertisers.

"So far Nine has been quite happy to trade at very similar numbers to (rival network) Seven, based on its performance," Mr Allen said.

Mr Allen said discounting would force Nine into a battle with third-ranked commercial network Ten while Seven grabbed market share.

"That would make it more difficult to turn Nine around," he said.

Source: www.news.com.au

Good call on that, Diehard.

[Titanic]

Yep, totally agree.

[DIEHARD]

I have to say, I love seeing that smug Gyngell taken down quite a few notches.

[DIEHARD]

Clubs await $500,000 TV bonus

CLUB chief executives are expected to seek answers from the game's hierarchy at a meeting in Sydney tomorrow after it emerged delays in finalising the new broadcasting deal with the Nine Network and Foxtel meant they may not receive a promised bonus of $500,000 by the end of the month.

As part of the formation of the independent commission this year, clubs were told they would receive a one-off payment of $500,000 when the broadcasting deal was finalised.

The commission trumpeted its $1.025 billion broadcasting deal in August, but after signing a heads of agreement, delays in finalising the long-form agreements with Nine and Foxtel mean no money has changed hands.

The commission has not received its advance payment of $90 million, $80m of which was to come from the cash-strapped Nine Network. The payments of $500,000 were scheduled to come from that advance and be delivered to the clubs by October 31.

Club officials received an email last week informing them the commission was working hard to finalise its agreements with Nine and Foxtel but there were no guarantees the promised $500,000 would arrive by the deadline.

That is unlikely to sit well with the clubs, considering they were encouraged to invoice the commission. In lieu of that, the commission has pledged to cover the cost of GST on the advance, which amounts to $50,000 per club.

"The clubs are aware of the fact we are looking to pay that money as soon as possible and it is dependent on the finalisation of the long-form agreement with the networks," commission interim chief executive Shane Mattiske said. "We are very close to that point and we are looking to ensure they receive payments as early as possible."

Despite Mattiske's assurances, the issue is likely to be hotly debated at tomorrow's chief executives' meeting. As well as the $500,000 payment, the clubs are expected to seek answers over the salary cap and annual grant, neither of which has been finalised for next season. While the clubs are working on a $5m salary cap for 2013, that figure has not been ratified by the Rugby League Players Association.

"There has been no salary cap agreed with the players for 2013," RLPA chief executive David Garnsey said.

The agenda for tomorrow's meeting also includes an update on research into the shoulder charge, which is being conducted with a view to potentially banning the technique.

But those matters are likely to take a backseat to angst over the promised $500,000 and ongoing uncertainty over the broadcasting deal. Commission officials insist the delays have nothing to do with the dramas at the Nine Network -- the station is heavily in debt and is in danger of going into administration.

However, it was reported last night that lenders had agreed on a debt-for-equity deal.

That agreement on Nine's $3.3bn debt, if confirmed today, could allow the network to refocus its energies on finalising its deal with the commission.

Uncertainty over the $500,000 is symptomatic of wider issues which continue to plague the game. A host of high-profile players are about to enter the final year of their contracts but talks have been put on hold by clubs and agents as they await news on the salary cap.

http://www.theaustralian.com.au

[DIEHARD]

NRL clubs have half a million reasons to be angry

LAST November, the independent commission was about to be blown up before it even formed.

Angry clubs weren't going to play in any 2012 NRL competition, thanks very much, unless they received a significant increase in funding.

When they were told they would receive a one-off "sustainability grant" of $500,000 this year, it wasn't as much as they wanted but it appeased them.

Crisis averted. Bring on the commission. Good times.

Yesterday, club chief executives were left fuming when an email arrived in their in boxes explaining that the half-a-mill was not coming any time soon - but here's $50,000 to cover the GST to square it off with the tax man.

Interim chief executive Shane Mattiske last night promised they would be paid "as soon as possible", which in League Land often translates to "whenever we find the money".

It is not Mattiske's fault but it is another calamitous turn of events for a code without a chief executive, yet to confirm a naming rights or media rights or commercial radio rights partner, as Knights players waited for Nathan Tinkler to pay them, while free-to-air broadcaster Channel 9 dragged itself back from the brink of receivership.

Good times.

By his own admission, Mattiske does not covet the job his glass-jawed predecessor David Gallop was ungraciously tipped out of earlier this year.

Yet he is regularly forced to defend the game, because chairman John Grant often defers most of the questions to management.

A management without a chief executive, because he sacked the last one.

The issue of the one-off $500,000 grant is certain to be a major topic of discussion at tomorrow's chief executives' meeting.

Clubs had expected the cash before October 31, because that is when the present broadcast rights deal ends.

"We are all waiting on the money," said one prominent club official. "That is when all our accounts are done to (October 31)."

That grant is inexorably linked to the $1 billion television broadcast deal struck with Nine and Fox Sports (which is owned by News Ltd, publishers of The Daily Telegraph) in late August over pizzas.

An ARL Commission spokesman insisted the dire financial predicament Nine has been facing is not the reason for the delay in the deal - and its advance payment of $80 million - being finalised.

The heads of agreement signed over the family sized Hawaiian and Meat Lovers' pizzas and trumpeted to the world merely started protracted negotiations over "long form" contracts. It is understood that Fox Sports has baulked at some of the terms, but the ARLC said that does not delay Nine signing its own long form agreement.

As more than one person at the network will tell you, if Nine lost league - especially Friday night footy - they may as well turn their Willoughby studios into a carpark.

It is that important to them.

"We were conscious of the complexity around Nine's financial position when we entered into our agreement with them," Mattiske said. "Our heads of agreement is a binding document with the network and is one that we are very confident will not be affected by the changes Nine is going through.

"Ultimately, rugby league represents a highly valuable and core programming asset to Nine. In addition, a number of specific provisions addressing risk are built into the contract to support our position."

Asked about the $500,000 payment to clubs, Mattiske said: "The clubs are aware of the fact we are looking to pay that money as soon as possible and it is dependent on the finalisation of the long form agreement with the networks. We are very close to that point and we are looking to ensure that they receive payments as early as possible."

Mattiske says the issue of naming, new media and radio rights are "all in their final stages of negotiation".

The collective bargaining agreement - which players are sweating on - is also close.

Which brings us to the question of the chief executive's chair that Mattiske has said he doesn't want to fill but continues to juggle as best he can.

"The commission is running a process through an external recruitment firm and has continued to work through a list of candidates," he said.

"They have made it clear that their focus is on getting the right person in place and that they are supportive of the actions of management in the meantime. It is a key decision and all parties are conscious of the need to reach some certainty around the position."

Given the present uncertainty besetting the game, it would take a brave soul to take it on.

Good times.

http://www.heraldsun.com.au/sport/nrl