10 May 2004
SMG plc: Disposal of GMTV Stake
The Board of SMG plc ('SMG') announces today (10 May, 2004) that it has agreed
the sale of its 25% shareholding in GMTV Limited ('GMTV') to ITV plc.
The sale is subject to regulatory approval and the rights of the other GMTV
shareholders, and will realise cash proceeds of £31.0m. As ITV plc has a 16.9%
holding in SMG, the sale is also subject to SMG shareholder approval as a
related party transaction. The value attributed to the shareholding by SMG in
its consolidated balance sheet at 31 December 2003 was £6.5m. The pre-tax
profit, after goodwill amortisation, attributable to the stake for the year
ending 31 December 2003 was £2.9m.
SMG's original 20% shareholding was acquired in 1991 and increased to 25% in
2000. Since that time, changes in the structure of GMTV's shareholder base have
resulted in SMG's Board taking the view that this investment could no longer be
regarded as strategic and that the interests of SMG's shareholders would be best
served by disposing of the stake. The proceeds of the sale will be used by SMG
to reduce debt.
Commenting on today's announcement, Andrew Flanagan, Chief Executive of SMG,
'The ITV merger created a 50% shareholder in GMTV and we don't want to have a
minority interest in someone else's media business. It is clearly in our
shareholders' interests to sell the stake at an attractive price. Our focus is
on driving and capitalising on the operational performance of our wholly-owned
media assets as the advertising markets continue to improve.'
10 May, 2004
Callum Spreng 0141 300 3640
Corporate Affairs Director
James Hogan 020 7404 5959
This information is provided by RNS
The company news service from the London Stock Exchange