GMG Radio has been sold to Global Radio for an undisclosed sum, thought to be around £70m.
After weeks of speculation, the announcement was made this morning, which is likely to mean Real Radio will become Heart across Wales, Scotland and the north of England, but this as yet is unconfirmed.
GMG Radio will continue to be run separately from Global Radio whilst a regulatory review into the acquisition is conducted. Global Radio will however continue to represent GMG Radio’s national airtime sales, as it has done since 2006.
Stuart Taylor, CEO of GMG Radio, is leaving the company with immediate effect. Therefore, Mark Lee, currently Global’s MD for the Regions, will be seconded from Global Radio to GMG Radio with immediate effect, assuming the role of CEO.
Announcing the purchase, Ashley Tabor, Founder and Executive President of Global Group said: “We are pleased to have concluded this deal, and once the required approvals have been received, we will look forward to welcoming the GMG radio stations into the Global family. We believe that this is a very strong business with brands and assets that are highly complementary to those of Global Radio.”
Andrew Miller, CEO of Guardian Media Group said: “Our portfolio of investments that lie outside our core national newspaper business exist to underpin the long-term financial and editorial integrity of the Guardian. If we believe that best value for the Group lies in the disposal of a non-core asset, then we will do so. The talented team at GMG Radio have been very successful in building strong brands, which have been attractive to listeners and advertisers and have attracted considerable external interest. We believe that this transaction gives the business an excellent opportunity to develop and flourish as part of Global Radio. I would like to thank everyone at GMG Radio for their outstanding achievements over the last few years and wish them every success for the future.”
It’s expected a large number of jobs will be at risk around the group, which employes hundreds of people in seven sites in England, Scotland and Wales.
Speculation about a sale started over two years ago, but a speculative article in the Guardian on June 12th prompted renewed interest in the potential sale of the Guardian’s radio assets. UTV were also thought to have put in an offer, along with a venture capitalist.
The group has spent over £200m on stations over its lifetime, and was thought to be worth around £120m today, meaning the Guardian Media Group has taken a big loss on the sale. But it’s not the first time a radio group has lost this much money. When Global Radio was formed it lost almost £200m after buying GCap Media and the Chrysalis radio division, and the value of radio stations in general has taken a dip in recent years.
A report in yesterday’s Sunday Times suggested that redundancies could soon be made at The Guardian and Observer after losses at the group grew to £45m in the 12 months to the end of March. Today’s sale helps to protect the future of The Guardian in the short-term.