DMG Regional Network still could Sell

DMG’s 60 regional radio stations in Australia might still be up for grabs according to a report in The Australian Financial Review.

The network’s future is now reportedly dependent on whether its UK owners can mount a successful bid for Hollinger International’s London newspaper, The Daily Telegraph.

West Australian Newspapers, Rural Press and Macquarie Bank are believed to be interested in the network, especially MacBank, which is reported to be negotiating exclusively with DMG.

A decision on the London Telegraph might be made by the end of the week, with DMG’s UK parent apparently one of three consortiums shortlisted with 3i Group and the Barclay brothers.

There has been continuing speculation that DMG would consider selling its Australian regional assets to shore up finances, if successful in securing the newspaper, but it is understood the company has struggled to structure its bid.

Only last Friday, DMG’s Australian CEO, Paul Thompson, told radioinfo in carefully chosen words that he has “received significant and increasing expressions of interest in our regional group over the past six-nine months, but we haven’t sold any assets to anyone.”

When Thompson began DMG, he told radioinfo that acquiring a group of regional stations was an important entry strategy into the Australian market. It provided him with a base of staff, equipment and cash flow which, at the time, he said was important as a launching pad to a new capital city network.

67 stations later, DMG has one frequency in each major capital city market, two in Sydney and possibly two in Melbourne (if successful in the August auction).

Other networks planning expansion must now be asking: “Does DMG still need to keep its launching pad?”, as they eye off the substantial assets the company has built since acquiring Ray Gamble’s regional stations in its launch phase.