Wireless Group To Be Auctioned

According to The Times, Goldman Sachs is advising the broadcaster following the distribution of a “sale memorandum” last week. However, TWG has not ruled out revisiting chairman and chief executive Kelvin MacKenzie’s management buyout, which collapsed after Veronis Suhler Stevenson withdrew its backing last week, providing another investor can be found.

Interest in TWG is expected to be high, with a spate of consolidation currently gripping the radio industry. The company’s largest stakeholder, News Corporation, has indicated that it is open to offers for the £75 million business, according to The Times.

Amongst the other radio companies currently being circled for acquisition is Scottish Radio Holdings, which last year was rumoured to have been close to a take over by multi-media group, Emap, who have a stake of nearly 28% in the company (see Rumours Surround Emap Take Over Of SRH).

Scottish Media Group is also the subject of attention from its larger rivals, with Chrysalis believed to be considering a bid, while venture capitalists 3i and Lord Alli are understood to have offered £100 million for its acquisition.

Recently Lord Alli has been looking to acquire SMG-owned Virgin Radio. However, SMG has rejected two offers for the station. The labour peer had hoped to win support from ITV shareholders in his bid for Virgin, but this plan has been dashed, with shareholders ruling out the possibility of involvement in breaking SMG up (see ITV Rules Out Helping Alli Buy Virgin).

Meanwhile, radio giants Capital and GWR are reported to merge in May (see Capital And GWR Agree £711 Million Merger Terms), following news that the Office of Fair Trading would not be referring the two companies’ consolidation to the Competition Commission. The mammoth consolidation will create the UK’s largest radio company, worth around £711 million.