UTV Merger Bid For SMG

SMG, owner of cinema advertising business Pearl & Dean and Virgin Radio, has released a statement confirming that it has received a merger bid from UTV.

The statement follows a report in the Times which said that UTV had made an approach. In the statement, the SMG board said that if the merger were to take place then shareholders would receive 50% of the combined company.

Reports in the press claim that SMG has some concerns that it is a slightly larger business than UTV, with a market capitalisation is £221 million, compared to £175 million for UTV.

UTV is understood to have proposed a nil premium merger to SMG, which also owns ITV franchises STV and Grampian, and outdoor advertiser Primesight.

SMG said in its statement: “The Board of SMG notes the press speculation regarding a possible merger with UTV plc (‘UTV’). SMG confirms that it has received a merger proposal from UTV.

“Under the terms of this proposal, SMG shareholders would receive a 50% interest in the merged entity.”

ITV is one of SMG’s main shareholders and there has been speculation in the past that it might try to buy STV in order to consolidate its network.