GCap tipped to sell off stations to invest in Capital

by Daniel Farey-Jones, Brand Republic 14-Nov-05, 11:00

LONDON - Radio group GCap Media is ready to sell a number of regional stations, including The Storm, and invest in underperforming station 95.8 Capital FM, according to reports.

The Sunday Times claims that GCap is to announce a large-scale reorganisation at its interim results presentation on November 24.

The company has already signalled its intention to invest £2m before May, its financial year-end, and £7m in the following year, in improving its analogue stations.

Capital FM is the prime contender for an injection, having lost 367,000 listeners in a year and slipped from first to third place in market share among London's commercial radio stations.

The group has also been tipped by observers to champion its analogue indie station Xfm at the expense of similar digital-only brand The Storm.

The Storm broadcasts on DAB regional multiplexes in Bristol, Coventry and Wolverhampton, as well as nationally on Sky and the internet, but has a weekly reach of only 76,000 listeners.

The Sunday Times report also names Essex FM, Trent FM and Plymouth Sound as contenders for the chop.

Any disposals would attract the interest of Macquarie and The Local Radio Company, which are looking to acquire radio assets.

The industry is also watching GCap for its response to Ofcom's proposal for a new national digital radio multiplex, which is due in this week. Claiming it was awarded the only existing multiplex with the promise of exclusivity, GCap is considering legal action to stop Ofcom introducing more digital stations.

GCap shares were trading at 326.5p this morning, down 2.5p.

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