In what can be considered a shot across the bows of the BBC, News Corp’s UK and Ireland arm is to acquire radio-focused media group Wireless in a deal worth approximately £220.3 million (€263m), representing a premium of approximately 70.3 per cent. over the Closing Price of 185 pence per Wireless Share on 29 June 2016, being the last Business Day prior to announcement of the deal; and 69.1 per cent. to the volume weighted average price of 186 pence per Wireless Share for the three months prior to the date of this announcement.
Wireless’s brands include talkSPORT, the leading sports radio network in the UK, and a wider portfolio of media assets with a significant presence and audience engagement, both digitally and internationally. News Corp believes that Wireless represents an excellent strategic fit with its existing operations, broadening News Corp’s range of services in the UK, Ireland and internationally.
talkSPORT has radio and digital audio broadcasting rights for the Premier League, the FA Cup and the EFL Cup. It also has the global live audio rights to the Premier League in multiple languages (outside the EEA) to 2019.
According to News Corp, Wireless’s audience complements the audience of its best-selling tabloid newspaper The Sun, suggesting there is significant opportunity to increase engagement and monetisation through cross-promotion and leveraging Wireless’s and News Corp’s respective talent and advertising sales forces. The acquisition also raises the prospect of further international digital expansion for the Wireless brands.
The UK and Ireland are key markets for News Corp. In the past few years News Corp has acquired Storyful in Ireland and Unruly in the UK. Those companies continue to operate as standalone businesses and they are adding value to the wider News group’s global assets. The proposed acquisition of Wireless follows this trend.
News Corp, which is evolving rapidly into a more digital and increasingly global company with a diverse revenue mix, has a proven track record of investing in content that drives audiences and in businesses that complement its existing brands and platforms.
News Corp says it has been impressed by the skills and experience of the existing management and employees of Wireless, and expects them to play a leading role in growing the Wireless business in an increasingly competitive digital media environment as part of the wider News group.
Wireless’s Directors intend unanimously to recommend that Wireless Shareholders accept the Offer, as the Wireless Directors have irrevocably undertaken to do in respect of their own beneficial holdings of Wireless Shares.
Robert Thomson, Chief Executive of News Corp said the proposed investment was a clear sign of News Corp’s commitment to, and belief in, the United Kingdom as a place to do business successfully and profitably. “We look forward to welcoming Wireless into News Corp’s global family of businesses. With its strength in radio, as well as its digital and international growth potential, Wireless will help improve the engagement of our publishing brands, especially those within News UK. There is no doubt that Wireless is a company reborn since the sale of its television assets last year and we are excited by its prospects. We plan to leverage Wireless’s portfolio of radio and digital audio sports rights, including the Premier League, in the UK, Ireland and beyond, through News Corp’s digital platforms. We believe the businesses together can be far more than the sum of their parts.”
“News UK has a stable of iconic brands and a track record of creating content that builds engaged and loyal audiences,” commented Rebekah Brooks, Chief Executive of News UK. “The Wireless Group represents an opportunity for us to take advantage of its strong radio presence to build on our growing digital success story and to bring some of the best journalistic and broadcasting talent into one group. This acquisition will allow us to increase engagement for both businesses through the cross promotion of our brands and the use of our respective talent. We also look forward to collaborating in the expansion of the Wireless Group’s digital audio and international assets, which offer new opportunities for our businesses in the UK and globally.”
“This is an excellent outcome for all Wireless stakeholders,” declared Richard Huntingford, Executive Chairman of Wireless. “Shareholders receive an immediate and certain cash value for their shares which not only represents a very significant premium to the current share price, but also fully recognises the long-term prospects and growth potential of Wireless; News Corp’s proven track record of investing in content that drives audiences will significantly benefit Wireless’ listeners and advertisers; and, the excellent strategic fit and complementariness of the Wireless business to News Corp’s operations will provide great opportunities for Wireless’s management, employees and talent. Finally, the introduction of a new player with the stature and global media experience of News Corp will be a major boost for the UK and Irish commercial radio industry.”