Sources said this could be the last deal by UTV into the radio sector for some time.
New ownership rules detailed by the Broadcasting Commission of Ireland (BCI) recently, restricts players in the market to a maximum 17.9% share of all licensed radio services.
After the LMFM deal, UTV will be close to that limit, leading to market speculation that this may see the end of its expansion into radio for some time to come in the south.
Overall, UTV has an impressive line up of radio stations in the Irish Republic.
Franchises include 96 and 103 FM in Cork, Q102 in Dublin and Live 95 FM, Limerick.
Denis O’Brien, who made €250m by selling Esat Digifone’s mobile license, ranks second in the Irish radio market, controlling 14% of licensed services.
Under Irish law, the Competition Authority must approve all media takeovers and mergers. UTV was due to buy 82% of the shares in LMFM, according to earlier market speculation.
But the existing shareholders finally agreed to sell out their total shareholding.
UTV is believed to have paid €9.5m to clinch the deal, which is bang in the middle of the guide price in the market of between €9 million and €10 million.
In the year to 31 August LMFM generated a turnover ad turnover of €2.1m and operating profits of €500,000.
UTV says the deal make sense because it gives it added depth in the consolidating and increasingly difficult British and Irish markets.
UTV’s chief executive, John McGann, sees the takeover as enhancing the group’s credibility as a key player in the rapidly consolidating British and Irish markets.
UTV is buying the Drogheda based station, excluding a number of properties that are part of the radio station set up.
As a result of this latest deal and the restrictions put on ownership by the BCI, sources confirmed that the Galway Bay FM outlet may not be bought for some time.