Richard Eyre is steadfast about buying Virgin Radio, Stephen
These days, every senior business leader under 50 seems to be compared
in some way to the new Prime Minister, Tony Blair. But in the case of
Capital Radio’s managing director, Richard Eyre, there are a number of
good reasons why his peers have made this connection.
Both men are committed Christians, both have had to modernise
organisations that had seemed stuck in a 70s timewarp - and both seem to
spend an inordinate amount of time trying to keep the City happy.
Oh yes, and both Blair and Eyre have just completed a deal with Richard
Branson where the arch-manipulator stole most of the press coverage.
Branson walked away from Virgin Radio after losing millions of pounds.
But somehow, he made it seem like he was taking over Capital Radio
instead (Campaign, last week).
Virgin puffery aside, Eyre’s deal with Branson doesn’t look too bad on
the face of it. Capital spends pounds 65 million on a rather crackly
national AM licence and an extremely lucrative London FM licence, gets
to keep the much-loved Virgin name for 25 years, takes on pounds 22
million of debt and gives Branson a seat on the board. So why wasn’t the
City impressed? The group’s share price barely flickered at the
’The Virgin deal was announced on the same day as Capital’s interim
results,’ one analyst says. ’Those results showed Capital’s turnover is
up 41 per cent but its profit is up by only 7 per cent. We believe the
hike in both is down to the Capital’s purchase of the My Kinda Town
restaurant chain in 1996 and the difference between turnover and profit
is giving us cause for concern. We would have preferred Eyre to spend
his cash on Virgin rather than My Kinda Town. It’s a more focused
Not surprisingly, Eyre is dismissive of this criticism. ’I don’t have a
problem with our margins,’ he explains. ’The restaurant business has
different margins to radio.
’If all we wanted was great margins we could sell everything except our
London licence,’ Eyre adds. ’I didn’t want to spend our cash on Virgin
as I wanted Richard Branson on our board. That’s why we issued shares to
secure the Virgin deal.
’Virgin is one of the most exciting companies in the world, after
I would do the My Kinda Town deal again tomorrow. I think it will make
some people eat their words.’
That deal is clearly still a sore point with Eyre. One senior Capital
source recalls the day the My Kinda Town deal was announced to the
financial press to some scorn from the assembled media and, in
particular, a reporter from the Financial Times. When the journalist
asked a particularly insolent question, Eyre was seen to turn white with
fury. ’He was so angry, he couldn’t speak to answer the journalist’s
question,’ the source says.
Eyre claims he cannot remember the incident, but he adds that he was
annoyed by the ’quality of the appraisal work done by the ladies and
gentlemen of the fourth estate’.
Simon Cole, the managing director of Unique Broadcasting, the UK’s
largest independent production company, is not surprised by Eyre’s
’Capital Radio really matters to Richard,’ Cole says. ’He lives for it
and he has a zeal and an enthusiasm for the medium itself which is rare
in a radio industry that is all about spreadsheets these days.’
Cole recalls that, when Eyre arrived at Capital from his previous
position as media director of Bartle Bogle Hegarty, the man was like a
sponge - eager to soak up as much knowledge as possible about the
industry in as short a time as he could.
It was during those early days of unbounded enthusiasm that Eyre dreamed
up the initiative that was to become National Network Radio.
It was in trying to persuade the industry to adopt this perfectly
logical sales aid, however, that Eyre first came face to face with the
darker machinations of UK commercial radio.
By the time NNR had been through all the relevant commercial radio
committees and all the national and local sales directors, plus the
various pro-gramme controllers who had insisted on putting their oar in,
INR4 - which was Eyre’s original name - had become a bunch of spots
going out in certain time slots. It had lost the programming and
sponsorship opportunities of Eyre’s original dream.
Despite all that, it remains one of the bolder initiatives the industry
has created and occurred at the same time Eyre helped to build the
legendary Radio Advertising Bureau.
The industry may respect Eyre, but it is still carping at the Virgin
purchase and particularly Capital’s decision to close down its airtime
sales house, Media Sales and Marketing.
Both Emap and GWR are seething and appear to be forming their own sales
houses. Heart 106.2’s shareholder, Chrysalis, is almost certain to seek
an Office of Fair Trading referral for the deal. The advertisers, on the
other hand, seem pretty happy.
’We’re still taking advice about what the market position will be,’ Bob
Wootton, the director of media services at the Incorporated Society of
British Advertisers, explains. ’It looks like it will cause a slight
decentralisation of sales points which is a deal in the right
’We are a little worried about the London position as it could give
Capital a huge proportion of London listeners, but Capital has been
involving us continually and talking to us as much as it has dared. In
that I see Richard’s hand at work.’
Wootton adds: ’When Richard was at BBH and I was at Horner Collis and
Kirvan I found him a straight guy, even though we were firing from
different trenches. The advertising world is always throwing up people
who get promoted beyond their ability, but Richard’s clearly handling
Capital in an expert and creative way.’
This creativity shouldn’t surprise adland. After all, when he was media
director at BBH, Eyre built the agency’s media department up from
nothing to one of the most respected in the business and, to some
extent, BBH still misses his guiding hand today.
Under Eyre’s programme of modernisation at Capital, the station shed
some pointless overseas investments such as Riviera, the radio station
for ex-pats on the south coast of France, and focused on owning every
ILR radio station that Londoners and London commuters could listen to.
If the My Kinda Town deal was a little off-beam, the Virgin move seems
to make up for it.
The question is, what next? The City doesn’t like companies that hang
around. Eyre says he has to wait three months for the Radio Authority,
during which time he can hardly do anything.
He is then going to have to start work on developing digital radio and
deal with the merger of two extremely different companies with two
relatively different styles of management.
Supporting Eyre in all his endeavours will be his team of David
Mansfield and Richard Park, the Capital commercial director and the
programme director respectively.
’I’ve never experienced a tighter top team than those three,’ Cole
’They speak with one voice, believe each other to be the best possible
for the job and they form a formidable triple alliance.
’They work very methodically, unlike the rest of the radio industry, so
those outfits that plan to take them on over the Virgin deal should be
very careful,’ he adds.
A powerful triumvirate at the top? That sounds even more like New
The question is, out of Mansfield and Park, which is John Prescott and
which is Peter Mandelson?
On second thoughts, it is probably best not to push that comparison too