Three offers for GMG Radio, say reports

12/06/2012 - 08:25 | 34 Replies More

Global Radio, UTV Media and a group of venture capitalists are reported to have made offers for Real Radio and Smooth Radio operator GMG Radio.

A report in The Guardian – part of the same group as GMG Radio – suggests Global’s offer, thought to be around £50m, is the largest of the three bids.

The paper says GMG Radio has spent more than £200m on acquisitions and in the year to last March valued its assets at £118.9m. It also says GMG has never officially put its radio division up for sale, though RadioToday.co.uk is aware of much industry speculation surrounding a possible sale of the group over the last two years.

Global Radio already handles national sales for GMG Radio’s portfolio and in areas like South Wales, Central Scotland, Yorkshire, the North East and North West would be able to add a Heart station on FM in regions where it already operates a Capital FM station. There would, however, be some competition issues in North Wales where Global already operates licences under the Heart brand – and in London, the Midlands and the North West and North East if the biggest commercial radio group also bought GMG Radio’s regional FM Smooth Radio licences.

Read more on the story in MediaGuardian here.


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Category: Industry News

  • http://www.facebook.com/profile.php?id=557090356 Craig Hannington on Facebook

    Make it four….just taken
    my change to sainsburys I have 59 quid spare im happy to make them an offer of that

  • http://www.facebook.com/profile.php?id=100000519113542 Simon Parton on Facebook

    Sounds like more bloody Hearts and Capitals on the way then if Global get their mitts on GMG

  • http://www.facebook.com/profile.php?id=1132452669 Dave Botha on Facebook

    The Global beast ever hungry prepares to slay more good radio… ;(

  • http://www.facebook.com/profile.php?id=570809788 Barry David on Facebook

    “Smooth Heart” .. has a ring to it …. The only positive move would be a UK wide Juice !

  • http://www.facebook.com/profile.php?id=1012645667 Paul Grimsdell on Facebook

    I can see them turning Real in Heart, but Smooth is an older demo, surely?

  • http://www.facebook.com/profile.php?id=524665565 David Grundy on Facebook

    Smooth/Gold…

  • http://www.facebook.com/profile.php?id=524665565 David Grundy on Facebook

    Sponsored by Nescafé.

  • http://www.facebook.com/profile.php?id=1055950813 Barry Evans on Facebook

    hope real radio dosent get to be heart or i will be looking for another radio station to listen to the real and smooth brands are popular and i dont see why it should be ruined if gmg radio do decide to sell hope this is pointed out for who there sell up to or local radio can r.i.p

  • Seenit

    If GMG has spent £200 million on assets, why would they sell for only £50 million? That would be insane!

  • Seenit

    Just to add,
    GMG have written over £80 million off the value of their radio division! OUCH!

    I would not
    be happy if I lost such a sum of money on an investment and I certainly would
    not be happy if I lost 75% of my investment compared to what I initially paid.

    How the value of radio assets have changed.

    • MB

      It’s just an book accounting adjustment though due to current market conditions. Most shares have taken a tumble over the past couple of years.

      They haven’t actually lost that amount in cash. It could be revalued up again in a couple of years.

      The big question is why GMG would sell now when assets are at the bottom of the market. Then again maybe they won’t – didn’t we go through all this speculation with Absolute last year and then it came to nothing?

      • Seenit

        Accounting adjustments are real (sorry about the pun) though, if GMG Radio is sold for £150 million less than the cost of creating it, someone actually loses that amount of money.

        If they keep hold of it, the value of the assets could potentially recover. Although in this day and age, it is unlikely – the world of media has evolved and grown.

  • Seenit

    One last thing, who in their right mind would invest in
    buying into radio as business when the potential losses are so evident and have
    been consistent for many years? Look at what Capital Radio was once valued at
    (almost £1 billion). By the time they merged with GWR the combined company was
    worth just over £700 million, then by the time it was snapped up by Global it
    was significantly under £400 million. These are phenomenal amounts of value to
    lose, which over confident person feels they can turn this trend around?

    A massive chunk of adverting revenue ends up with the likes of Google these
    days, that I don’t think is likely to shift back to radio sadly!

  • http://twitter.com/LenGroat Len Groat

    This is a TRIUMPH for the  hype of the ‘money men’…

    …. but a DISASTER for the last vestiges of what was a great LOCAL radio industry…

  • Mylastrolo

    The purchased assets of GMG also include the Real Radio Network. That explains the price differential.

    Guardian have no shareholders, they are a Trust.

    Like a quite a few other ponderous newspaper companies, who have “invested” in so called new media, they arrogantly believe their newspaper skills are somehow valid in operating radio stations. The truth is that they are well out of their comfort zone. The result always turns to disposal and asset stripping.

    Critically, Smooth Radio has failed to capture the crucial London market. Their RAJAR reach looms from 4 to 5%, and then back again. During the past 12 months they hit their lowest ever audience levels, currently sitting right at the murky near bottom of the scale.

    Proof once again, that you will never capture the capital’s radio market with a remote base or mentality.  

    We have a Hotel Inspector, and a Restaurant Inspector…Smooth would be the ideal candidate for a Radio Inspector?

    Parky has the best chance of turning around this operation.  No doubt he has a brace of yellow cards ready for the current incumbents. 

  • Seenit

    I will be massively suprised if any radio operator or investor manages to make a markup in the future on their investment if they buy into radio today.

    Good on them if they do though. However the future is not looking great based on how radio stock has performed over the ten years.

    This peoblem is not confined to radio either, it is a problem across all comerical media. Look at the share price of Facebook, it has not grown yet and is now sadly slipping the wrong direction.

    Facebook is considered to be vastly more cutting edge with far more room to inovate and grow (with it not having any bounds of operating within Ofcom rulings).

  • http://www.facebook.com/profile.php?id=699045912 Mark Jones on Facebook

    The real brand Is not very popular in the north west now, I think making it into a heart would make it a lot better .

  • Radio Geordie

    Funny isn’t it?  The shit only hit the fan after John Myers “left” the company only to be replaced by someone who obviously doesn’t know what they are doing.  This group only got as big as they did thanks to John.  He knew how to run a radio company and how to make it successful.  The ROCK RADIO rebranding to REAL XS has obviously backfired as has the nationalisation of SMOOTH RADIO.

    I can’t see how a bunch of venture capitalists could make the group work either.  In fact, I see them as a bunch of opportunists, they are only interested in owning radio licences and how much they could squeeze out of them before selling them on for as big a profit as possible.

    If UTV were to buy the group, I don’t think much would change as most GMG stations broadcast in areas where UTV don’t, a perfect fit area wise.

    If Global bought the company, its fairly obvious what will happen.  REAL RADIO will become HEART, XS will become XFM (except in Manchester as its already there) and SMOOTH RADIO would be rebranded as GOLD with only the London, Manchester and East MIdlands AM licences being given up.

  • http://www.facebook.com/profile.php?id=570809788 Barry David on Facebook

    I think Heart and Smooth are a close format … Smooth is uk wide ..So what station could hold that position in a buy out .. Gold , Heart ,or a UTV station ..

  • http://www.facebook.com/profile.php?id=557090356 Craig Hannington on Facebook

    In light of my earlier offer,I won a Tenner on Lottery so,GMG I wish to up my offer to,£69.54 dont talk to Global talk to me Finance is in place and we can close this by Friday before the football…lets make this happen GMG

  • http://www.facebook.com/profile.php?id=699045912 Mark Jones on Facebook

    These days people are not bothered about local radio really , long as it plays the music they Like they don’t care ? Local radio is strong under the utv brand in the north , and it’s surprised me they don’t network more than they do .

  • http://www.facebook.com/profile.php?id=557090356 Craig Hannington on Facebook

    Being serious I hope that global dont get it uk wide Heart would be dreadful and as the last London rajar showed people are gettig bored of the same song over and over again and dont get me started on the dire club classics which coul be called last nights dance tunes in a slightly different order

  • http://www.facebook.com/profile.php?id=100000137245534 James Carim-radiointheuk on Facebook

    Not sure how I feel about this to be honest,on the one hand Global have a lot of stations/licences(mainly Heart & Gold) already,dont think they should get any more Heart or Gold stations/licences,I imagine Global would have to dispose of a few stations/licences(Gold in Midlands is going,soon to be Free Radio 80′s,Heart in Nottingham has already gone,now Gem 106) though if their offer was accepted,if Global have to get rid of stations it could open up the doors for smaller radio groups to expand,swings and roundabouts?,UTV Media wise Smooth could be a good addition to their group,would Real be a good addition to the group?,no idea about the other interested group of people that want to buy,I think Global will be the most complicated deal though

  • http://www.facebook.com/profile.php?id=699045912 Mark Jones on Facebook

    Must admit Hearts not for me , but club classics every night of the week is way too much . I don’t know if northern People have the same music tastes when it comes to heart as southern People do ? I think real xs would go ? But not sure what to ? Can’t be xfm ? The arrow I don’t know as global took that off dab ? Absolute classic rock ?

  • http://www.facebook.com/profile.php?id=100000137245534 James Carim-radiointheuk on Facebook

    Maybe Nation Radio could expand?

  • http://www.facebook.com/profile.php?id=100000137245534 James Carim-radiointheuk on Facebook

    Also Planet Rock,Q,Kerrang! could expand I guess,not many rock stations around in the UK

  • http://www.facebook.com/profile.php?id=570809788 Barry David on Facebook

    Well GMG have Rock Radio .. which became Real Radio XS .. Which is just a mess …We know GMG have problems … But would in be in that state if Myers was there ………….. looks like the suits havnt helped GMG

  • http://www.facebook.com/profile.php?id=100000137245534 James Carim-radiointheuk on Facebook

    I also think Global may have too many existing brands anyway,as things stand they have Capital,Choice,Classic FM,Gold,Heart,LBC,XFM along with Chill & The Arrow,the last two are hanging on by a thread,I dont think much or any money is being put into them(feel free to correct me if I’m wrong) and can see those going,maybe Gold &/or Choice &/or even XFM aswell,it would leave Global to focus on Heart & Capital and I think those are the only brands they are really bothered about at the moment,Global cant have it all forever something has to give

  • http://www.facebook.com/profile.php?id=100000137245534 James Carim-radiointheuk on Facebook

    I dont really understand the name Real Radio XS(XS=Extreme?),is it a down with the kids name?,I’d have called it any of the following: Real Rock,Real Rock Radio,Real Radio Rock,ahh well

  • Tinkabell73

    Oh I’m sure Real radio northwest must be worth….. Ooooo id say about 50 PENCE! Since that moron Mathews tried to make his mark, we he did “real fail radio”.
    Hope you got ya taxi booked plonker uncharge!!

  • Davewiggywiggins003

    This Is Not Good At All Wright Now I Do Just Hope Gmg Managers Do See This Wright Now Do Not Sell Your Gmg Radio Stations Real Radio And Smooth Radio And Real Radio Xs To Global Radio Group Please Gmg I Do Hope You Gmg Have A ReThink And Do Keep Your  Good Gmg Radio Stations Real Radio And Smooth Radio And Real Radio Xs Please Please Please Gmg Do Not Sell Your Stations To Global Radio And Call Off The Sale Please Gmg That Would Be Far Much Better Gmg Wright Now And Save Your Good Radio Stations Please Gmg Now 

  • Davewiggywiggins003

    I Just Wish All People Do Not Say Any Thing About This Gmg Radio Up For Sale Today I Have Been In Touch With Real Radio Wales And Gmg They Say To Me It Is Not True It Is Just News Paper Talk  Not True So Please Stop Pick On Gmg  Gmg Is A Good Radio Group And That Is True It Is Not For Sale So Stop Talking About Gmg Please Now

  • Davewiggywiggins003

    Gmg Radio Stations Real Radio And Smooth Radio And Real Radio Xs
    Are Not For Sale So GoodBye  To Global Radio Leave Your Hands Off Gmg Radio Stations Wright Now And I Just Hope Bauer Media Will Step In And Help Gmg Radio Group To Keep Their Real Radio And Smooth Radio And Real Radio Xs  On The Air Broadcasting For Good That Would Be So Much Better Wright Now 

  • Davewiggywiggins003

    Gmg Radio Stations Real Radio And Smooth Radio And Real Radio Xs 
    Are Not For Sale So Good Bye To Global Radio Group And Leave Your Hands Off Gmg Radio Stations Now  And I Just Hope Wright Now That Bauer Media 
    Or Utv Will Step In And Help Gmg To Keep Gmg Radio Stations 
    Real Radio And Smooth Radio And Real Radio Xs  On The Air For Good That Would Be So Much Better Wright Now

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