Ulster TV in merger talks

Ulster TV confirmed today they were back in merger talks with SMG.

The company, which operates 24 stations including talkSport and Virgin, approached SMG just three months after it was rebuffed by its potential partner.

SMG, which owns most of Scotland's commercial TV network, revealed today it was back in talks and said it would put its search for a new chief executive on hold while the merger discussions take place.

A successful tie-up will create a media group worth around £400m (€591.26m).

SMG turned down two "unacceptable" merger offers in late August. The first offer proposed a nil-premium merger, while the second offered SMG a slightly bigger share of the combined company.

They were both rejected because SMG's market value was significantly higher than UTV's, making it a bad deal for SMG. However, UTV was worth £211m (€311.9m) on Friday night, while SMG had a value of £179m (€264.6m) - making a merger more attractive.

Under City rules, UTV is prevented from making another offer until mid-March, although this does not apply if an agreement or recommendation from the board of SMG is forthcoming.

Glasgow-based SMG added that "good progress" was being made on plans to sell outdoor advertising business Primesight and cinema counterpart Pearl & Dean.

It also said constructive discussions were taking place with its banks after it emerged in October that the company was in potential breach of certain financial covenants.

Radio and television presenter Chris Evans still holds nearly 10 million SMG shares, or just more than 3% of the company, after he sold Virgin Radio and his TV company Ginger Productions to SMG three years ago for £225m (€332.6m).