Ex-tabloid editor and Murdoch matie Kelvin MacKenzie has been forced to sell one of The Wireless Group’s principal radio stations in an attempt to comply with its banking covenants.
MacKenzie, quondam editor of Britain's best-selling national daily, The Sun, is now chairman and chief executive of TWG, and learning the hard way that making headlines is easier than making money.
His loss-making commercial radio group sold Southampton-based Wave 105FM to Scottish Radio Holdings for £18 million cash. Also part of the SRH selloff – for a further £1m – was TWG’s 24.5% holding in Scottish regional radio station Kingdom FM. Earlier this year, MacKenzie was forced to dispose of another choice property, Scot FM, for £25 million to the Guardian Media Group [WAMN: 11-Jun-01].
The group’s banking covenants required that TWG reduce its debt below £18.5m by the end of November. On completion of the sale to SRH, Wireless Group claims it will have net cash of £1 million.
Says MacKenzie: “We are not content to be sellers of assets but uncertain capital-market conditions meant we had to take this action. TWG is now debt free, leaving us to concentrate on developing the business.”
The main shareholder in TWG with a 20% stake is Rupert Murdoch’s News International.
News source: The Times (London)