Traffic reports are big business for live media elsewhere, just as in the US. And the industry is being consolidated internationally. Global Traffic Network (GTN) announced a deal to acquire the commercial division of UBC Media Group plc for $13.1 million plus future consideration, expanding GTN’s radio operations in the UK.
GTN will acquire all of the outstanding shares of The Unique Broadcasting Company Limited, a wholly owned subsidiary of UBC. UBC’s commercial division supplies traffic and travel information to approximately 230 radio stations and entertainment news information to approximately 120 radio stations in the United Kingdom in exchange for commercial airtime inventory that is then sold to advertisers. UBC’s commercial division has nearly 14,000 radio commercials available for sale on a weekly basis.
GTN’s UK subsidiary will acquire the share capital of The Unique Broadcasting Company for £9 million (approximately $13.1 million) at closing and three additional potential earn-out payments based on the financial performance of the acquired business during the 2009, 2010 and 2011. For 2009, UBC will be entitled to £1 million if the acquired business generates 2009 revenue of at least £11.0 million, and will be entitled to a higher payment amount, up to a maximum of £5.5 million, based on a graduated schedule of 2009 revenue ranging from £11 million to £13.6 million. For 2010 and 2011, UBC will be entitled to receive 50% of the amount by which revenue from the acquired business exceeds £12 million or £12.5 million, respectively.
“We are extremely excited about the acquisition, as it will dramatically increase our presence in the United Kingdom, adding approximately 230 radio stations and over 700,000 radio advertising spots per year. The acquisition not only significantly expands our business in the U.K.; it dramatically increases the size and scope of Global Traffic Network as a whole. The stations currently serviced by the commercial division of UBC have a non-duplicated cume of approximately 21.5 million listeners weekly, which is greater than our combined reach in Australia and Canada,” said William L. Yde III, Chairman, CEO and President of Global Traffic Network.
RBR/TVBR observation: Several former Westwood One and Metro Networks executives are involved in GTN, which is based in New York but operates only outside the US. Westwood One itself used to be a major shareholder, with over 1.5 million shares, a bit over 12% of GTN. However, Westwood One said in an SEC filing last August that it had sold its entire stake.