SMG TO FLOAT VIRGIN RADIO

New SMG chief executive Rob Woodward accused his predecessors of a “weak and flawed strategy”. Woodward, a former Channel 4 executive, was brought in to revive the company’s fortunes after a shareholder revolt followed a failed mer­ger with rival UTV in February.

SMG’s problems are reflected in the likely stock market value for Virgin Radio, £100million compared with the £225million it paid for DJ Chris Evans’s Ginger Media Group seven years ago. Woodward said SMG’s collection of disparate media assets had created “excess debt, a lack of focus and poor staff morale”.

Virgin Radio, which broadcasts to about 2.5million listeners, is set to be spun off via a stock market listing by the end of summer, although SMG has not ruled out a trade sale.

SMG, which last autumn warned it was close to breaching its banking covenants, has just refinanced its bank debt, with a new £193million facility. Its shares jumped 3p to 67bp.