Three Capital stations join GWR stable

COMMERCIAL television's consolidation fever spread to the independent radio sector yesterday, with two of Britain's biggest stations joining forces. Capital Radio announced it was selling three Midlands radio stations to GWR, the USM-quoted operator, for pounds 4.8m cash and 1 million shares in GWR.

The deal takes Capital's stake in GWR from 4 per cent to 20 per cent. GWR has also agreed to use Media Sales and Marketing, Capital's sales arm, to sell airtime on all its stations.

Capital acquired the stations - Mercia Sound, Leicester Sound and Radio Trent - when it bought Midlands Radio in an agreed bid in April. Richard Eyre, Capital's managing director, said the sale would lead to an exceptional profit of pounds 3.3m.

GWR also announced yesterday that it was buying Shropshire's Beacon Broadcasting for pounds 3.7m.

Daily Mail and General Trust, which also owns 20 per cent of GWR, yesterday reported a 24 per cent increase in profits before exceptional items thanks to record advertising revenue at the Daily Mail, the Mail on Sunday and the Evening Standard and circulation rises at the Mail stablemates.

Reported pre-tax profits rose by 74 per cent to pounds 66.7m, largely reflecting the absence of pounds 26.5m of property provisions last time. The dividend on DMGT's 'A' non-voting shares is 14 per cent higher, with a final of 112p. News of a nine-for-one bonus issue left the 'A' shares pounds 6.75 higher at pounds 115.75.

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