Jazz FM and Guardian Media Group (GMG) have reached an agreement following a revised takeover offer from GMG for the radio station, the two groups announced yesterday evening.
GMG had previously tabled an offer of 180p per share, or £41 million, but the Jazz FM Board had urged its shareholders to take no action with respect to the bid (see
Guardian’s Jazz FM Offer Goes Ahead). Nevertheless the offer became binding as no competing bid was made.
However, the two groups have now agreed a new deal, which will see GMG pay 195p per share for Jazz, valuing the company at around £44.5 million. This is above Jazz FM’s market capitalisation as at the close of trading yesterday, when its shares stood at 179p. It also represents a premium of approximately 40% on the closing price of 139½p on 3 May 2002, the day of trading before GMG made its original offer on 7 May (see Guardian Media Group Makes £41m Offer For Jazz FM).
“This acquisition represents a further significant step in GMG’s commitment to the implementation of our radio strategy. GMG’s radio portfolio will also benefit from the addition of an outstanding enterprises division which has been responsible for establishing the successful Hed Kandi, jazz fm and Stereo Sushi CD labels,” Paul Myners, chairman of GMG.
At 10:15am today, shares in Jazz FM had shot up by 13½p to 192½p.
