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SMG confirms new merger talks with UTV

LONDON - Scottish Media Group has confirmed it has received a further approach from UTV and as a result it has suspended its search for a new chief executive.

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In a statement issued this morning, SMG said that it has been approached by UTV regarding a "possible nil premium merger of SMG and UTV, based on relative market values". A nil premium merger usually suggests a 50:50 merger of equals, which might make the deal more attractive.

The new talks between the two Celtic media groups come three months after SMG rejected UTV's last approach.

SMG said that the search process for a new CEO for SMG, following the resignation of Andrew Flanagan in July, had been suspended while merger discussions progress. Internal candidate Fru Hazlitt, the chief executive of Virgin Radio, is believed to be a strong contender.

SMG added that good progress is being made on the disposals of outdoor company Primesight and cinema advertising contractor Pearl & Dean.

UTV was not allowed to enter formal discussions for six months following its last approach, unless it was invited to do so by the SMG board.

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