Speculation Continues Over Possible Yahoo!/EMAP Deal

There was continued speculation over the Easter weekend that internet group Yahoo! is considering making a takeover bid for media group EMAP. When rumours of the deal surfaced early last week, shares in the UK magazine publisher and radio broadcaster rose in response (see Sharewatch). Since then the value of a possible bid has been put at £4bn or more, although neither company has given any confirmation of a prospective bid. Spokesmen from both EMAP and Yahoo! today said that their companies “do not comment on market speculation”.

Yahoo! operates its internet search engine and portal worldwide, while EMAP owns UK consumer magazine titles including FHM, Smash Hits and Empire, along with radio networks, including the Kiss and Magic brands, and cable TV music channel The Box. A merger between the two companies would provide Yahoo! with content from Emap’s print titles, which could then be distributed across Yahoo!’s global internet network. EMAP also has established media operations in the US and France.

The prospect of an internet portal, which potentially reaches a national and global audience, owning radio and TV interests could raise issues with competition authorities. To date, neither the Competition Commission nor the Office of Fair Trading has seen any precedent set on such cases. A spokesman from the Office of Fair Trading said that were the deal to go ahead, it was probable that the OFT would “take an interest” in the competition issues, and that an invitation to comment would in that case be issued. Presently, there is no watchdog in place to regulate the activities of internet organisations.

Following the logic of the AOL/Time Warner merger (see AOL And Time Warner Confirm Mega-Merger), this deal could be an ideal match. At this stage, however, there is little to suggest that an actual approach from Yahoo! is forthcoming, or that it would necessarily be welcomed by EMAP.

EMAP: 01733 568 900 Yahoo!: 020 7664 0434 … www.yahoo.com