Chrysalis is selling its radio division to a new investment company chaired by former ITV chief executive Charles Allen (pictured). Global Radio will buy Heart, Galaxy and LBC for £170m.
The acquisition was announced this morning (Monday) and it has since emerged that the group’s chief executive Richard Huntingford will step down in the autumn once the deal has gone through. However, the radio division’s chief executive Phil Riley and commercial director Don Thompson are likely to stay on.
Chrysalis says it will make a £95m profit on the deal, taking into account the £75m it has invested in radio since launching Heart 13 years ago. Between £90m and £100m of capital will be returned to shareholders as a result of the transaction.
The deal leaves the media company with just its music business, having already disposed of its TV production and book publishing operations. It also marks former Granada chief executive Allen’s return to the media industry following his departure from ITV in January this year.
Chrysalis announced a review into the “strategic options” for its radio division in February. It says selling to Global Radio, which plans to use Chrysalis Radio as a platform to further expand in UK commercial radio, best satisfied the objectives of the strategic review.
Chrysalis Radio is the UK’s third largest commercial radio operator, with eight major market FM licences, one AM licence and 31 DAB digital radio licences.