Michael Grade, the new chairman of ITV, is on the verge of seizing the rights to show live FA Cup and England home matches from the BBC and Sky in a deal worth more than £100 million a year.

This will leave the BBC without live football outside big international tournaments, and is a coup for Mr Grade, who is battling to restore ITV’s reputation as a popular, mass-market broadcaster.

It is understood that, under the new four-year deal being negotiated, ITV and Setanta Sports, its partner, will secure the cup and international games for just over £420 million, with the two companies splitting the rights to matches.

Final negotiations between the FA, ITV and Setanta were going on last night at Soho Square, as the parties resolved the final terms of a deal. It remains possible, but unlikely, that the deal will collapse, but the expectation yesterday evening was that the announcement would be made at a press conference today.

The agreement will begin from August next year, and the cash — £100 million more than the current agreement — salvages some badly needed pride for Brian Barwick, the FA chief executive, who faces public criticism for the decision to appoint Steve McClaren as England head coach.

Meanwhile, the BBC — still the most popular sports broadcaster in Britain — will be battling to ensure that Gary Lineker, Alan Hansen and other sports presenters stay with the corporation when there will be almost no live matches for them to present. ITV, whose football faces include Steve Ryder and Andy Townsend, is likely to consider poaching top BBC talent, as it did when it brought Des Lynam over from the corporation a decade ago.

Under the new agreement ITV will broadcast England home qualifiers for the 2010 World Cup and the 2012 European Championships, while Setanta Sports will show friendlies. ITV is expected to get the first pick of FA Cup ties in each round, and seven games will be televised in the third, fourth and fifth rounds.

Cash has been flooding back into football over the past two years as broadcasters compete aggressively for audiences. Last year the Premier League sold a three-year broadcast rights package for £2.1 billion, an increase of about 60 per cent on the previous £1.3 billion agreement.

ITV is spending nearly £3 million a game in what is Mr Grade’s first big move since he took the helm at the turn of the year. Football brings guaranteed mass audiences, with popular matches attracting seven million to nine million viewers in an era when television viewing is fragmenting in the face of multichannel competition.

For Setanta Sports, the victory represents another step up for the broadcaster, which was founded by two expatriate Irishmen, who bought the live rights to Ireland against Holland in the 1990 World Cup to show in a West London pub. A year ago Setanta successfully bid £392 million for the rights to show 46 Premier League games a year, alongside Sky.

Setanta will transmit its newly won games on a pay-channel, which will cost £10.99 on Freeview, the digital television service. It hopes that it can develop a low-cost, paid-for alternative to Sky.

ITV and Setanta defeated a BBC-Sky joint bid, ending eight years of control by the public and satellite broadcaster. Sky no longer believes that holding the FA Cup and England rights is important, while the BBC was unable to justify financially matching the ITV offer.

However, yesterday the BBC produced viewing data demon-strating that while it transmitted FA Cup games the average audience for live matches recovered from five million in 2001, when ITV last had the rights, to nine million in 2006.

Once seen to be in crisis, the FA Cup is now considered to be in recovery.

Match stats

74,000 The number of people who watched the FA Cup final at the Millennium Stadium in Cardiff last year

£50m The amount Chelsea will earn next season from television deals and prize money

18.5m The number of people who watched England v Sweden in the World Cup on ITV1 last June, making it the most-watched programme of the year

16% The percentage of revenue lost by Channel 4 last year because it did not show any World Cup football

£100,000-£200,000 Estimated cost of an advertising slot during the World Cup

Source: Times database

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