Capital rethinks its future after Chris Evans grabs Virgin
Wednesday 10 December 1997
As the news sank in, the City marked Capital's shares down by as much as 27.5p to 472.5p, before regaining confidence in the stock, which closed up 2.5p to 502.5p.
Capital cannot take legal action against Virgin as its contract with the group ceased to be legally binding when the deal was referred to the Monopolies and Mergers Commission.
A spokesman for the Department of Trade and Industry said last night that the report into the merger would still be published, despite the rejection of Capital's bid.
Observers expect an exceptional charge of around pounds 1m in the 1998 profit and loss account after taking account of legal and administrative fees for the abortive deal. Capital indicated the figure would be well below pounds 1m.
David Mansfield, chief executive of Capital, said he was "surprised and disappointed" by Virgin's decision. However, he said he awaited the outcome of the MMC report with interest.
Mr Mansfield said Capital had told the MMC that the group's share of radio advertising should be judged in the context of the total value of London's advertising market. London's advertising market across all media is worth pounds 1.6bn, while radio's share of that figure comes to just pounds 75m.
"An important part of our case to the MMC was that radio competes and is very much part of the wider advertising market," Mr Mansfield added. "We will be very interested to see if the MMC have recognised this."
Analysts said that if the MMC accepted Capital's points about advertising, the group could bid for Melody Radio, a London station. Whatever the outcome of the report, Capital is now likely to bid for the North-east radio licence. The company has already put in a bid for the North-west franchise.
- 1 BBC told new political editor must be 'impartial' with Nick Robinson reportedly stepping down
- 2 Number of young homeless people in Britain is 'more than three times the official figures'
- 3 The map showing the most dangerous tourist destinations in Europe, according to the Foreign Office
- 4 The biggest first date turnoff has been revealed
- 5 German man found living with 300 rats in tiny apartment
BBC told new political editor must be 'impartial' with Nick Robinson reportedly stepping down
Humans of New York image of crying gay teen receives best response yet from Ellen DeGeneres
Isis propaganda video shows 25 Syrian soldiers executed by teenage militants in Palmyra
Number of young homeless people in Britain is 'more than three times the official figures'
Budget 2015: George Osborne to axe subsidies for higher income earners in social housing
More Britons believe that multiculturalism makes the country worse - not better, says poll
Nathan Collier: Montana man inspired by same-sex marriage ruling requests right to wed two wives
Greece crisis: IMF was pushed around by Angela Merkel and Nicholas Sarkozy – and now it is being humiliated
'I wish the BBC would stop calling it Islamic State' – David Cameron unleashes frustration at broadcaster
Forget little green men – aliens will look like humans, says Cambridge University evolution expert
Girl, 7, stares down hate preacher at Ohio festival with pro-LGBT rainbow flag gesture
iJobs Money & Business
£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...
£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...
£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....
£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...