Tycoon's ‘Netflix of Sports' stumbles in bid for UK Premier League and Champions League
For much of the bidding process, billionaire Len Blavatnik’s streaming service DAZN, known as the “Netflix of Sports”, was widely reported as the likely winner.
BT Group Plc had been trying to find a buyer or partner for its pay-TV unit BT Sport for at least 10 months, with rivals including DAZN, Walt Disney Co., Amazon.com Inc. and Discovery Inc. all sizing up potential offers. For much of the bidding process, billionaire Len c's streaming service DAZN, known as the “Netflix of Sports”, was widely reported as the likely winner.
Such was the confidence within the DAZN camp, one executive was even spotted playing Township, a farming simulation game, on his smartphone during a meeting with BT at Goldman Sachs Group Inc., according to people familiar with the matter, who asked not to be named because the discussions were private.
In the end, BT lost confidence in DAZN's bid, the people said. After a bout of last minute negotiations, BT revealed on Thursday that it would pursue a joint venture with a rival bidder, U.S. entertainment group Discovery, which would combine it with Eurosport UK.
Representatives for BT and DAZN declined to comment.
Success would have won DAZN rights to the U.K. Premier League and Champions League soccer, crown jewels that would have granted a splashy entrance to the region's biggest live sport broadcast market. It recently won major sports rights deals in Germany, Italy and Spain.
Deliberations continued until late on Wednesday, the people familiar with the matter said. DAZN even raised its bid in the final stages of negotiations in an effort to save the deal, they said.
Ultimately BT's Chairman Adam Crozier, Chief Executive Officer Philip Jansen and consumer division chief Marc Allera opted for the longer-term value presented by Discovery's proposals.
Mike Darcey, a former COO at Sky, said an important factor in any decision would have been the level of security being demanded by the leagues that owned the sports rights being broadcast on BT Sport. The English Premier League has just signed a new three-year deal with BT.
“There are iron clad change of control clause in broadcast contracts,” he said. “Some will remember what happened to the Football League when OnDigital walked away from its contract and the EPL also had issues with Setanta. The leagues would have seen that DAZN is a significant loss-making entity and they would have presumably wanted a chunk of the three-year deal paid upfront or maybe a big guarantee from Blavatnik.”
DAZN's Chairman Kevin Mayer, a former Disney executive and briefly TikTok CEO who also launched several blank-check companies, said the group maintained its plans for growth in the U.K., where it streams boxing rights and Champions League womens' football, as well as sporting documentaries.
“We remain fully committed to growing our business and investing in the U.K., as you will see in the near future,” Mayer said in an emailed statement.
In the past year or so, DAZN has shifted strategy from pursuing secondary sports rights in a handful of markets, to launching in around 200 territories and focusing on blockbuster football rights in three markets: Italy, Spain and Germany.
DAZN's financial accounts for the year up to 31 December 2020 are overdue, according to a note at London's Companies House, where they have to be registered. The company's last set of published results, for the year to 2019, show a loss of $1.3 billion for continuing operations. The directors at the time concluded that the company had sufficient funds to continue given the support of the principal shareholder, Blavatnik's Access Industries.
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