Emap to pounce on radio group

MEDIA group Emap is poised to make an offer for the whole of Scottish Radio Holdings ahead of any decision by regulatory authorities on the proposed merger of radio rivals Capital and GWR.

The radio industry expected Emap, headed by chief executive Tom Moloney, to wait before going ahead with a bid until the Capital/GWR deal had been cleared by the regulators.

The Office of Fair Trading is expected to refer the £700m Capital/GWR deal to the Competition Commission.

But Emap is understood to have calculated that if it merged its radio business with Scottish Radio, its market share would be 24.98% - that is below the level that would trigger an automatic referral to the Competition Commission.

Emap, which already holds a 28% stake in Scottish Radio, is now understood to be working on the premise that a quick deal to acquire the remainder before the end of November would allow it to make a further acquisition in the radio sector soon after.

Emap has a market value of about £2bn and owns radio stations Kiss FM - with its highly popular DJ Bam Bam - and Magic, as well as magazines including FHM and Smash Hits. It bought its Scottish Radio stake this year for 930p a share.

Under stock market rules, it is obliged to offer not less than the same price per share for the remainder of the company if it makes a bid for the rest within a year of first taking a stake in the business. Scottish Radio closed on Friday at 937p.

Scottish Radio has 22 stations including Clyde 1 and Forth 1 in Glasgow and Edinburgh and it also owns several local newspapers.

Emap refused to comment, while Scottish Radio said there had been no meetings between the two companies on the issue.