Global Radio given five weeks to make formal offer for GCap
Friday 01 February 2008
Global Radio has been given five weeks by the Takeover Panel to make a formal offer for GCap Media or walk away.
The panel said Global Radio, the privately owned group chaired by former ITV boss Charles Allen, must indicate a firm intention to bid for GCap by 5 March or refrain from bidding for six months.
GCap, the owner of Classic FM and Capital 95.8, rejected a £313m bid by Global, last month, saying the offer of 190p a share in cash "significantly undervalued the company". Its chief executive Fru Hazlitt branded the offer "derisory".
GCap welcomed the "Put up or Shut up Deadline" imposed by the regulator.
"By 5 March, Global Radio will have had more than 11 weeks since its initial approach and more than three weeks since Fru Hazlitt's presentation of her plans for the group to make a decision," a statement from the company said.
GCap, which was formed after Capital Radio bought GWR Group Plc in 2005, had a value of £700m at the time of the merger but its market capitalisation had fallen to around £200 before speculation of the bid emerged.
Global, which runs the Heart, Galaxy and LBC networks, is keen to build up its business after losing out to German company H Bauer in the battle for Emap's radio assets.
Analysts expect Global to come back with a higher offer. "We expect Global to raise its offer to circa 210p and thereby secure board recommendation," Numis said in a research note.
GCap reported higher third-quarter revenues yesterday, despite a drop in listeners, and said it had seen no evidence so far of a downturn in radio advertising.
The group said like-for-like revenues rose four per cent in the three months to 31 December and that revenues for January were expected to climb 7 per cent.
"Current trading is in line with our expectations and the radio advertising market remains stable, with no evidence to date of any downturn," the company said.
However, data from the Radio Joint Audience Research revealed that total year-on-year listening figures at the group's radio stations fell to 14.8 million in the quarter from 15 million.
The data also showed no improvement in market share for GCap's flagship station, 95.8 Capital, once the favourite station in London but now in third place behind Heart and Bauer's Magic 105.4.
- 1 Autism 'caused by genetics', study suggests
- 2 What happens to your body when you give up sugar?
- 3 Why you should never make assumptions about people with autism
- 4 Tourist films plane's descent just metres above packed Caribbean beach
- 5 Have sex with your iPad thanks to the new sex toy no-one asked for
Tourist films plane's descent just metres above packed Caribbean beach
Bali nine: Welcome to 'Execution Island' – the Indonesian holiday resort where foreigners are sent to die
How Homer Simpson discovered the Higgs boson over a decade before scientists
The 'sex selfie stick' lets you FaceTime the inside of a vagina
Harrison Ford plane crash: Star Wars actor 'seriously injured' after light aircraft crash lands
Durham Free School: 'Creationism taught at' free school facing closure
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
End of the licence fee: BBC to back radical overhaul of how it is funded
Ex-head of MI6: 'We shouldn't kid ourselves that Russia is on a path to democracy'
Most people think legal tax avoidance is just as wrong as illegal tax evasion, poll suggests
Nigel Farage promises Ukip will not 'stigmatise' would-be migrants – and says he wants 'everyone to speak the same language'
iJobs Money & Business
£13000 per annum: Recruitment Genius: This is an exciting opportunity to join ...
£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...
£8 per hour: Recruitment Genius: This Pension Specialist was established early...
£30 - 35k + Bonus & Benefits: Guru Careers: We are seeking an Executive Assist...