Capital and GWR merger gets Ofcom and OFT approval
LONDON – Media regulator Ofcom and the Office of Fair Trading will not stand in the way of the £700m merger between Capital Radio and the GWR Group, the two said today.
Ofcom released the results of its merger review, revealing that secretary of state Tessa Jowell will not issue an Intervention Notice.
However, Ofcom said two out of the 30 GWR licences would undergo changes to safeguard local programming. The licences affected are GWR Bristol and Bath FM, which must maintain separate breakfast services, and MFM/Buzz Wrexham and Chester FM, which will see a separate weekday breakfast service for the Wirral written into the licence.
The Office of Fair Trading ruled that the combined radio companies would be "complementary not competing" and has passed the merger by not referring the acquisition of GWR by Capital to the Competition Commission.
Vincent Smith, the OFT's director of competition enforcement, said: "Except in the East Midlands, the radio stations of Capital and GWR do not strongly overlap at a local level. So, for national advertisers putting together a radio advertising package they are largely complementary rather than competing alternatives."
Capital has already offered to sell Century 106 FM to address the identified adverse competition effects.
The Capital/GWR merger, which was provisionally announced in September, will create the UK's biggest radio company, controlling 40% of the radio advertising market.
The merged group will own one national, 55 analogue stations and 93 digital stations, reaching approximately 18m listeners.
The new group, which will have a combined turnover of £243m, will represent a 36% share of the commercial radio audience.
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