SINGAPORE - Media agency MP & Silva (MPS) has witnessed its London headquarters declared insolvent by the United Kingdom's High Court of Justice, and it could face legal issues here in Singapore too, if it does not respond to claims made against it for monies that allegedly remain unpaid.
The Straits Times understands that the Football Association of Singapore (FAS) has sent a letter of demand to MPS' Singapore office, to reclaim some $3 million in unpaid rights fees from a $25 million, six-year deal that was signed in 2015.
The FAS' letter of demand, believed to have been sent last week, means that MPS has 14 days to respond, before the matter goes to local courts.
It remains unclear what impact the closing of its London headquarters has on its 12 other offices across the globe, but sources revealed that the MPS office in Singapore has witnessed an exodus of management staff in recent months, which has hamstrung its operations here.
The claim is muddled by the Singapore-Argentina match played in June last year to mark the FAS' 125th anniversary
(the visitors won 6-0) that was organised by the FAS and international sport and entertainment promoter Unicess.
Industry insiders revealed that by working with another promoter, the FAS had broken the terms of the exclusive rights deal with MPS, with the company ceasing payments to the FAS, and moving to terminate the contract in December last year.
It is believed that moves were made to revive the deal earlier this year, before MPS' downward spiral.
Sources revealed that MPS' Singapore president and group chief executive Seamus O'Brien, who joined only in January, left the organisation over three months ago.
He was followed out the door by Wu Swee Sin, MPS' Asia-Pacific managing director, along with several other management-level staff, leaving what sources reveal is a skeleton crew of junior staff numbering fewer than 10.
The remaining staff have had their hands tied because of the company's legal issues and are understood to have conducted little to no business over the last four months.
This is believed to be a major factor that has left the FAS matter unresolved. MPS has also reportedly failed to make payments to several other creditors, including the English Premier League, Italian Serie A, and German Bundesliga.
Across the Causeway, its 15-year, RM1.2 billion (S$395 million) deal with the Football Association of Malaysia (FAM), also signed in 2015, has been terminated and the matter is now before the courts.
MPS was founded in 2004 by Italian businessmen Riccardo Silva and Andrea Radrizzani, the owner of English Championship side Leeds United. Under their leadership, it became the biggest player in the global sports media rights market, holding the broadcast rights to major competitions such as the top English, German and Italian leagues, and Formula One.
But things started going downhill after Silva and Radrizzani sold a 65 per cent stake to Chinese companies Everbright Securities and Beijing Baofeng Technology for US$1 billion (S$1.38 billion) two years ago.
At that time, cashed-up Chinese firms and businessmen had been buying sports assets worldwide for a year or two already, including taking stakes in leading football clubs and securing big-name players such as former Brazil striker Hulk for the Chinese Super League, often on huge wages.
With Chinese President Xi Jinping, a well-known fan of the Beautiful Game and who had made explicit his wish for China to one day win the men's World Cup, there was no holding back.
For instance, retail giant Suning bought 18-time Italian champions Inter Milan for €270 million (S$422 million) in 2016, while rivals AC Milan were acquired by businessman Li Yonghong a year later. Elsewhere, West Bromwich Albion, Wolverhampton, Southampton (all England) and Atletico Madrid (Spain) also saw some degree of Chinese ownership.
But the spending spree has slowed considerably since last year amid a government clampdown on what was deemed "irrational overseas investment", which put the sports acquisitions right in Beijing's crosshairs.
A retreat began. MPS was wound up by the UK's High Court last month after a petition to dissolve the company was brought by the French Tennis Federation (FFT) because the agency had defaulted on rights-holder payments since June.
The FFT told the courts that it was owed about £5.7 million (S$10.2 million), with the ruling meaning that MPS will now be dissolved, and its assets and outstanding income collected and distributed to creditors.
MPS Singapore had last month declined to respond to queries from The Straits Times, citing ongoing legal issues. But its office was uncontactable this time around.