SMG undeterred by Granada’s reaction to Ginger takeover

Scottish Media Group’s acquisition of Ginger Media Group is expected to go ahead, despite speculation that Granada will attempt to scupper it by voting against the proposal.

Scottish Media Group’s acquisition of Ginger Media Group is

expected to go ahead, despite speculation that Granada will attempt to

scupper it by voting against the proposal.



As an 18.5 per cent shareholder in SMG, Granada will have an opportunity

to vote at the general meeting, due to be held on 31 January. A

spokesperson for Granada said the reports were premature. He said: ’We

are yet to be convinced that this is of shareholder value.’



The proposed pounds 225 million deal includes the absorption of pounds

75 million of Ginger’s debts. Apax Partners and Virgin group, which each

have a 20 per cent stake, and Chris Evans and Ginger’s management will

split the remaining pounds 150 million between them.



It is also thought that Granada believes the pounds 225 million price

tag excessive for the company.



A spokesperson for SMG scotched reports that Granada could put a spanner

in the works by claiming that a negative vote would at worst cancel out

the positive vote promised by another SMG shareholder, Flextech.



As well as shareholder approval, the other potential obstacle for the

merger is the compulsory public interest test being carried out by the

Radio Authority.



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