Virgin radio on standby for stock market move

Virgin Radio today looked set for a stock market listing at around half the price paid to the broadcaster’s previous owner, DJ Chris Evans.

Media group SMG, which bought the business for £225m (€330m) in 2000, plans to spin off the radio arm so it can concentrate its efforts on television broadcasting and production, including STV in Scotland.

Virgin Radio is currently valued on SMG’s books at £105m (€330), a hefty discount on the figure SMG paid to Mr Evans’ Ginger Media Group in 2000.

The proposed radio flotation, which could take place in the summer, was unveiled at the same time as SMG announced annual profits had halved to £10m (€14.7m) during a “troubled” year.

Chairman Richard Findlay said the company, which also owns the advertising businesses Primesight and Pearl & Dean, had underperformed the media sector for some time.

He added: “It has had a weak strategy weakly executed, leading to excess debt, a lack of focus, instability in the leadership, dissatisfaction amongst the shareholders and poor staff morale.”

Mr Findlay said the first steps in the turnaround took place several weeks ago with a major boardroom clear-out, leading to the appointment of chief executive Rob Woodward, who is a former commercial director at Channel Four.

The company said the flotation of Virgin Radio would create a strong and focused radio business, while allowing SMG to concentrate on meeting the needs of television viewers and advertisers.