Pearson quits as chief of SMG radio, leaving Virgin Radio rudderless

The man behind Virgin Radio announced he was quitting the company yesterday to seek a "more flexible work-life balance", leaving the station's owner, SMG, searching for a replacement.

The man behind Virgin Radio announced he was quitting the company yesterday to seek a "more flexible work-life balance", leaving the station's owner, SMG, searching for a replacement.

John Pearson, the chief executive of SMG's radio division, announced he would be leaving in April having been at the company 12 years. He joined Virgin in 1992 as sales director and became chief executive in 1997. After SMG bought the business he became responsible for the group's radio division.

His departure will allow him to spend more time with his family, which includes four children. Thanks to the purchase of Virgin by SMG he has personal wealth of several million pounds. "This is a lifestyle choice," Mr Pearson said. "I'd like a more flexible work-life balance and the ability to take more time off."

Analysts believe Mr Pearson's resignation suggests there is no immediate prospect of SMG taking part in the consolidation of the radio industry. Although it has paid down debt with the sale of its newspaper division, the company still lacks the financial firepower to make meaningful acquisitions.

Its most valuable asset, the channel three franchise for Scotland, is thought to have only one obvious buyer - ITV - while buyers of radio assets are unlikely to pay SMG's asking price for a business it sees as core to its future plans.

Virgin Radio has a valuable FM licence in London but a rapidly declining AM national licence. Although digital radio will give Virgin another national platform there are worries that digital take-up will not be as fast as the rate of AM decline.

SMG paid £225m in January 2000 for Ginger Media Group, then owned by the DJ Chris Evans. The group included Virgin Radio and a TV production company. Mr Evans later made an acrimonious departure and sued for wrongful dismissal.

Virgin has since suffered from volatile listener figures and in the first half of this year produced profits of £2.5m, down 17 per cent from £3m in 2003.

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