Rupert Murdoch’s News Corp buys former UTV radio stations

Company agrees deal to acquire Belfast’s Wireless Group for £220m

Rebekah Brooks,  chief executive of News UK

Rebekah Brooks, chief executive of News UK

 

News Corp is to buy Belfast’s Wireless Group in a £220 million deal. Rupert Murdoch’s company will pay 315 pence a share for the radio-focused Wireless, it has announced.

The acquisition will see the group’s biggest asset, London-based radio station TalkSport, and seven Irish radio stations come under the control of News Corp (UK and Ireland), which also owns the Sun, the Times and the Sunday Times newspapers, as well as the Dublin-based news agency Storyful.

Rebekah Brooks, the chief executive of News UK (the company’s trading name), said Wireless represented “an opportunity for us to take advantage of its strong radio presence to build on our growing digital success story”.

The acquisition would allow it “to increase engagement for both businesses through the cross promotion of our brands and the use of our respective talent”, she said.

“We also look forward to collaborating in the expansion of the Wireless Group’s digital audio and international assets, which offer new opportunities for our businesses in the UK and globally.”

The deal will have to be cleared by competition regulators in Ireland and the UK. Under Ireland’s media mergers legislation, it will also be examined on plurality grounds by the Broadcasting Authority of Ireland and Minister for Communications Denis Naughten.

Wireless is the company left behind when UTV Media sold its television assets and the name UTV to ITV plc in 2015.

In the Republic, it owns FM104 and Q102 in Dublin, LMFM in Louth and Meath, Cork’s 96FM and C103, and Live95FM in Limerick. It also owns U105.8FM in Belfast and operates an advertising sales house in Dublin.

In Britain, it owns 12 local radio stations, most of which are based in the north west of England, while earlier this year it was part of a consortium that won the licence to operate the second national UK digital radio multiplex, D2, on which it has launched three new stations, TalkRadio, TalkSport2 and Virgin Radio.

Wireless’s main commercial jewel, however, is the UK national station TalkSport, which holds lucrative football radio and digital audio broadcasting rights, including live English Premier League and FA Cup matches.

It also has the global live audio rights to the Premier League in multiple languages, outside the European Economic Area, until 2019.

News Corp said it believed the listenership of Wireless radio stations “complements” the audience of the Sun.

Richard Huntingford, the executive chairman of Wireless Group, said the takeover was “an excellent outcome for all Wireless stakeholders” that would give shareholdes an immediate and certain cash value for their shares at a “very significant premium to the current share price”.

The share price of Wireless jumped on the news. The company, which has its primary equity listing in London, began trading this morning at 185 pence, but has since soared 68 per cent to 310 pence.

Mr Huntingford, the former chairman of UTV Media who took on an executive role in March following the retirement of UTV chief executive John McCann, said the acquisition also “fully recognises the long-term prospects and growth potential” of the company.

“The introduction of a new player with the stature and global media experience of News Corp will be a major boost for the UK and Irish commercial radio industry.”

In April, Wireless signalled that it would suffer revenue declines at its radio stations in Ireland in 2016 “as the recovery in Irish radio fails to take hold”.

Although TalkSport’s fortunes and cost management helped UTV Media survive a sharp recession in advertising revenues better than some, the company incurred higher losses than expected when it set up the Dublin-based television channel UTV Ireland.

A string of profit warnings followed the channel’s debut in January 2015 and by the end of last year it sold both UTV Ireland and UTV, the channel that first broadcast from Belfast in 1959, to ITV, and Liverpool radio station Juice FM to Global Radio.

News Corp said there were “no immediate plans for any material changes in locations or personnel or any redeployment of assets” following the completion of the acquisition.

However, it signalled there may be “duplication” of some corporate and support functions that “could involve minor headcount reductions” in Wireless operations.