'Unwelcome' Virgin Radio bid turned down
Scottish media group SMG has rebuffed a £100m (€145.3m) bid for Virgin Radio, it emerged today.
SMG said the approach from Lord Alli, who is also the chairman of entertainment rights group Chorion, was “unwelcome”, several national newspapers reported today.
Lord Alli, who has put together a management team backed by investment group 3i, said he had been eyeing Virgin “for some time”, the Financial Times claimed.
A spokesman for Lord Alli and 3i confirmed they had made an approach to SMG for Virgin and that SMG had rejected it.
The consortium had not ruled out the possibility of making a direct approach to shareholders for the radio station, he said.
“We think this is an under-utilised asset,” the spokesman said. “The audience share has been declining under the present ownership and we believe that, by giving additional management focus to the assets, we can rebuild the brand to its former strength.”
No-one from SMG was available to comment, but the FT quoted the group as saying: “We receive approaches all the time. Virgin Radio is an excellent business and it’s not for sale.”
SMG said in September that it had lifted half-year profits by 20% as it sounded an optimistic note for a sustained recovery in advertising.
However, SMG said a weak quarter for its Rajar listening figures affected Virgin Radio’s trading position as turnover fell to £10.2m (€14.8m) from £11.8m (€17.1m). The division’s operating profits were down £500,000 (€726,600) to £2.5m (€3.6m).
The offer from the consortium reportedly followed a meeting between Lord Alli, 3i and SMG chairman Chris Masters at the end of last year. The FT quoted Lord Alli as saying: “(Mr Masters) had made clear that, no matter how much the price was, he wouldn’t sell.”
Lord Alli reportedly said the offer represented “a full and fair price”.
