Virgin Radio sold for £53million
The much anticipated sale of Virgin Radio by SMG has taken place. TIML Golden Square Limited, a wholly owned subsidiary of Times of India Group, have bought the station for £53 million and will spend a further £15 million on re-branding away from the Virgin name.
The new station will be managed by Absolute Radio, owners of JACK fm and FM107.9 in Oxford, and a team comprising Media and Entertainment specialists from TIML.
Part of the deal means the new owners will not be able to use the Virgin Radio brand because Richard Branson’s group has a joint venture in India with the Hindustan Times group. They said the backers of Absolute’s bid would be in competition if they had internet rights to the brand.
Virgin was concerned that having two Indian businesses with different relationships with Virgin Radio would be too confusing.
However, RadioToday.co.uk understands TIML Golden Square Ltd have the option of continuing to use the Virgin Radio name in the UK, for a licence cost of a further £8million. TIML has 90 days from the completion of the sale to rebrand.
Speaking on the transaction, Rob Woodward chief executive of SMG says: “I believe that £53.2 million represents a sound price for Virgin Radio and a good deal for SMG shareholders. The disposal of Virgin Radio is consistent with our overall strategy and the proceeds of the sale will allow us to return cash to shareholders, as well as further strengthen an already healthy balance sheet.
I would like to wish the management team and all the employees of Virgin Radio the best of luck for the future and I am sure that the business will continue to prosper under TIML’s ownership.”
Summing up Mr. A P Parigi, managing director & CEO of TIML says: “Now is a great period to be entering the UK market and the opportunity to acquire a valuable radio asset couldn’t have come at a better time. We have worked with ARI for many years now and their experience and expertise, coupled with that of the award winning staff at Golden Square, will deliver our collective vision of a powerful and exciting new brand that will engage all key stakeholders.”