UK Media Firm's Rights Issues Draws Lukewarm Response

17 July 2008

BELFAST: Investors have shown a distinct lack of enthusiasm for a £49.9 million ($99.9m; €62.7m) rights issue offered by Northern Ireland-based broadcaster UTV Media.

Just 41.5% of the available shares were taken up by existing investors, while Irish private equity firm TVC Holdings became the largest shareholder after taking an 11% stake.

Because the issue's underwriters have been forced to take up nearly 60% of the shares oin offer, analysts warn that other media companies may find it tougher to revive their balance sheets in this way.

Says Grant Goddard, from Enders Analysis: "The market has changed substantially in recent months and this sort of result will mean that potential underwriters will be extremely wary of offering to support rights issues from media companies."

Data sourced from Financial Times Online; additional content by WARC staff