7DIG.L Regulatory News (7DIG)

7 Mar 2005 07:02

UBC Media Group PLC07 March 2005 7 March 2005 UBC announces Heads Of Agreement With Channel 4 for strategic stake in Oneword Radio and issues Trading Update UBC Media Group plc (UBC), the digital radio broadcaster and programme producer,is pleased to announce that it has signed a heads of agreement with Channel 4Television Corporation (C4) which is expected to lead to C4 taking a 51%shareholding in the national digital radio station, Oneword Radio ("Oneword").It is expected that final agreement will be reached with Channel 4 by 31 March2005. UBC took full control of Oneword in July last year in order to restructure thebusiness. At the time, its then partner, USI Holdings, sold its 50% interest inOneword to UBC for consideration of £754,938, which was satisfied by the issueto USI Holdings of 2,435,282 new ordinary shares in UBC at 31 pence. The sale to C4 will be for cash and the price agreed for the 51% represents asubstantial premium to the price paid to USI Holdings. Oneword broadcasts an award-winning service featuring the best of the spokenword on the national digital radio multiplex, Digital One, as well as on Sky,Freeview and cable. As this transaction will clarify the position of Oneword, returning it to thestatus of a joint venture, UBC is taking this opportunity to update the marketon current trading and its expected outturn for the year end. UBC has benefited from strong growth in its Commercial Division which isexpected to show an increase in revenues of 77% over the preceding year. Thisgrowth has in part been generated from the enlarged traffic and travel newsservice following UBC's consolidation agreement with EMAP announced last July.On a like for like basis, the Commercial Division's revenues are expected to beup over 40% due to an increase in the number of analogue and new digitalstations joining UBC's networks. Overall, the rest of the group has continued to trade in line with expectationsand we are pleased with the progress made in integrating Smooth Operations intothe Production Division and its contribution to the group's performance. For the year to 31 March 2005, UBC is on track to breakeven at the level ofoperating profit before goodwill and investment costs in Oneword and associatecompanies. With future prospects in mind, we are encouraged by the Government's suggestionin the Green Paper on the future of the BBC that it will consider whether tomake the BBC's voluntary radio independent production quota larger and morebinding. The announcement of UBC's preliminary results is scheduled for Monday 20th June2005. Simon Cole, Chief executive of UBC commented: "This partnership with C4 is a tremendous vote of confidence in digital radio asa whole and specifically in the value of the digital assets we have built uphere at UBC. We are all looking forward tremendously to working with C4 ondeveloping one of the UK's leading digital radio formats" Michael Hodgson, Head of Corporate Development at Channel 4, said: "Oneword is an award-winning digital radio station performing strongly in agrowing industry and we are excited to be acquiring a majority stake. However,we have no plans to rebrand Oneword or develop existing Channel 4 formats forbroadcast on radio at present. "As we move towards a fully digital and converged world, we are activelyexploring opportunities that exist across all digital platforms and UBC Mediawill be a valuable partner to help us further explore the radio sector." - ENDS - For further information, please contact: Simon Cole, Chief Executive, UBC Media Group plc tel: 020 7453 1600Tim Allan, Portland tel: 020 7404 5344 Notes to Editors About UBC Media Group UBC Media Group plc is a UK public company quoted on the London Stock Exchange'sAIM market. The Group is a market leader in the supply of content to the radio,Internet and digital television industries in the UK. In addition to theentertainment and travel news services provided to commercial radio, the Groupis the largest independent producer of radio programming for the BBC. About Oneword Radio Oneword Radio broadcasts a quality speech service on the national multiplex,Digital One and was the Sony Radio digital station of the year for 2003. This information is provided by RNS The company news service from the London Stock Exchange