CMA finds competition concerns over Bauer Media’s takeovers

Bauer Media’s takeover of local radio stations from Celador, Lincs FM Group, UKRD and The Wireless Group has raised competition concerns with the Competition and Markets Authority.

The CMA found competition concerns as a result of Bauer acquiring some of the key rivals to their existing local radio stations in the West of England, West Midlands and Yorkshire regions.

The mergers will be referred for a phase 2 investigation unless the parties offer acceptable undertakings to address these competition concerns.

But the CMA’s primary concern is how these transactions could affect the future viability of First Radio Sales Limited (FRS).

FRS currently sells radio advertising on behalf of over 100 independent local radio stations across the UK, and is the only firm providing these stations with access to national advertisers.

Following its initial, Phase 1, investigation, the CMA has found that FRS may not be able to continue to stay in business after Bauer Media buys up a large number of the stations that currently make up its customer base. Without FRS, independent local radio stations could lose access to revenues from national radio advertising sales, which could, in turn, make it more difficult for them to compete at the local level.

The CMA says, as a result, customers for radio advertising could face higher prices and a lower quality service.

Bauer will now work with the Authority to work out a way forward. Dee Ford, CBE – Group Managing Director, Bauer Media Group told RadioToday: “We will work with the CMA over the coming days to propose solutions to the challenges that they have raised.”

Colin Raftery, Senior Director of Mergers, said: “About 90% of adults listen to the radio every week, and local radio remains an important way for advertisers to reach potential customers.

“FRS is particularly important for independent local radio stations because it’s currently the only realistic way for them to reach national advertisers. That’s why we’re concerned that Bauer’s buy ups, which could lead to FRS exiting the market and local stations losing access to national advertisers, could damage competition.

“If the merging businesses are unable to address the CMA’s concerns, the deal will be referred for an in-depth Phase 2 investigation, to be carried out by a group of independent CMA panel members.”

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13 Comments
  1. Mark Levy says

    What does mean. Are Bauer still allowed to take them over?

    1. mb23 says

      They need to come up with a solution to address the competition concerns, as Global did with Communicorp. It isn’t about what comes out of the speakers, it’s about advertising sales.

  2. Michael Bolton says

    Agree or disagree on consolidation of on air brands and output given the size of Global this should not be an issue for Bauer. But the structural implications in terms of radio sales and advertising is. The trouble is the one thing you want to maange and control is your sales organisation – They don’t want to be distracted by selling for other people, but I guess an arms length relationship sales house is not really great either!

  3. Russ says

    Maybe it is now time for FRS to get involved with the more stable Internet Radio Stations. They have been presenting proposals for ages to get them on board and are ignored.

  4. The Big Chap says

    You would think FRS would have realised this already as if you check their company details, they appear to be very closely related to UKRD Group.

    1. Amanda Holden... Honest says

      You would think *Bauer* would have thought of this. FRS was part of UKRD and just bought with it.

  5. Joe Smith says

    Bung em a few quid and all will be ok!

  6. Mark Budgen says

    Has Ashley taken over OFCOM yet?

    1. Joe Smith says

      He is in control there yes.

    2. Lee says

      I look forward to (not) hearing that Ashley has brought out OFCOM in a deal with the tories. He certainly seems to have alot of influence over them! OFCOMs new slogan could soon be ‘OFCOM give what Global Want’. Perhaps new radio station applications of interest should clearly state “Only Global or Bauer need apply, unless you are willing to sell to them’.

      1. mb23 says

        Celador’s radio division had £12m of losses on the balance sheet. The business was a failure, so what was the alternative to selling up?

        Maybe Global are successful because they produce brands that people want to listen to, unlike “The Breeze” (whatever that is).

  7. RathergoodDAB says

    Further proof that local radio has massive importance to its local people and as a vehicle for driving profit. Its great to see that despite OFCOM’s newly relaxed localness rules, people can still see that and are raising it for concern.

    #AmandaHoldenisntapreferenceofchoiceforeveryone

  8. john88 says

    ASHCOM has a nice ring to it

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