ITV Digital ups Football League offer to £74m

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The Football League has been made an improved offer of £74m by the administrators of ITV Digital to settle their disputed rights contract, it emerged yesterday as the pay-TV service was given just one week before it is put up for sale.

News of the offer came as the administrators, Deloitte & Touche, condemned the league, accusing it of disclosing confidential information and running a campaign that may destroy ITV Digital's business plan, threatening the service even if there is a football agreement.

"The campaign of negative publicity ... is severely undermining the administration process. This may have impacted on our ability to successfully restructure the business," Nick Dargan, the administrator, said.

In a High Court hearing yesterday, Michael Crystal QC, representing the administrators, said the survival of ITV Digital "now hangs on a knife edge". He said Carlton and Granada were not willing to provide any more funds to their ITV Digital joint venture, unless there is a new football deal.

It can only keep going for a further seven days on money left over from the original £20m provided by Carlton and Granada when ITV Digital was put into administration on 27 March.

"The administrators hope that during that week there will be a restructuring [deal]. If not, the normal business will come to an end and they will proceed to phase two, which is to sell the business as a going concern," Mr Crystal told the court.

ITV Digital had previously offered the league, which is owed £178.5m by the broadcaster, £50m to cover the last two years of a deal to televise games. The agreement covers the pay-TV rights to the league and selected free-to-air programmes on the main ITV1 network, including the Worthington Cup, highlights shows and the divisional play-offs.

Yesterday, David Burns, the Football League chairman, declared that ITV Digital had improved its offer, but only to £62m for the current contract, which came with "onerous and unacceptable" conditions.

Mr Burns said there was no doubt that a meeting of all 72 club chairmen this Thursday would reject the deal. He said he was sure that more time and money was available. "ITV Digital will continue as long as Carlton and Granada fund it. If they pull the plug, it is their choice. These are very wealthy companies and they can pay the money. We will not allow ourselves to be bullied by artificial deadlines," he said.

According to ITV, the league told it last Thursday that it was willing to accept £74m for the remaining two years of the contract. The administrators agreed but insisted the new deal covered three years of free-to-air content, instead of two.

A league spokesman agreed another £12m was offered but said it involved a whole new contract and was equally unacceptable. He said both figures, £62m for the existing contract and £74m for the extended deal, would be put before the chairmen on Thursday.

An ITV source said: "The Football League and David Burns are about to score the biggest own goal in the history of football. They are risking putting ITV Digital into liquidation and getting nothing."

The Football League has threatened to sue Carlton and Granada for £500m if no agreement can be struck, insisting its contract with ITV Digital came with parent company guarantees. Carlton and Granada deny any liability.

It emerged yesterday that the league had apparently dropped the solicitors who negotiated the original ITV Digital contract, Hammond Suddards Edge, in favour of Lawrence Graham.