Scottish Radio Holdings rejects takeover bid by Emap

MEDIA group Scottish Radio Holdings (SRH) has rebuffed a takeover attempt by its 27% shareholder Emap.

SRH, the owner of Today FM and the Kilkenny People newspaper, said the offer “significantly undervalues the company”.

Emap, which owns several radio stations and magazines in Britain, put an offer of 1,040 pence per share to SRH board earlier this month, valuing the group

at £374 million (553.4m).

Emap has been stalking the company for more than a year after purchasing the 27% stake from Scottish Media Group.

The takeover would be a good fit for Emap as it would give the owner of Magic radio network and Heat and Closer magazines a foothold in the radio and newspaper markets in Ireland and Scotland, where it has few titles.

Reacting to the Emap offer, SRH said in a statement: “The board of SRH is confident about the independent future of the company and believes SRH is well placed to continue to generate significant long-term shareholder value.”

It added: “The board would only support a bid that adequately reflects the full and fair value of the company’s strong future growth prospects, market-leading radio companies and established regional press titles.”

Emap said it was disappointed by the rejection and believes 1,040p offer “fully values” SRH.

“The board of Emap will continue to review the situation and in the meantime reserves the right to make an offer below 1040p, should a recommendation by the board of SRH for an offer at 1040p not be forthcoming.”

According to some analysts, a lengthy stand-off is on the cards unless Emap comes back with a higher offer.

“I was very surprised at the price that was offered and even more surprised that SRH said No to it,” said Leigh Webb, an analyst at Panmure Gordon in London.

“Unless they are going to play hardball, one of them has to bend. Otherwise it’s tough to see how this is going to get resolved.”

Shares in SRH were up by just under 15% yesterday at 1,002p.

Additional reporting by Bloomberg