With reports emerging this week that suggest Guardian Media Group has had offers for its radio business, there’s speculation a deal could soon be announced. But what would happen if Global bought the Real and Smooth brands? What does the future hold for the sector with another spurt of consolidation on the cards?

Real to Heart

Real Radio’s six regional licences cover areas that Global don’t already operate a Heart station on FM. This includes Yorkshire, the North West, the North East and Central Scotland. However, Real Radio also has a Wales-wide licence. This means a clash with Heart North West & Wales and Heart Cymru should a takeover happen.

Heart could replace Real across Wales and the existing Welsh ‘Hearts’ could be either sold or rebranded. Global may sell the whole of the Real Wales licence to avoid a competition commission problem in Cardiff where they’d own the big two commercial stations.

Smooth to Gold

Merging the Smooth and Gold networks would give Global a much stronger ‘easy listening’ station mix, which could challenge Magic and Radio 2 for audience.

There is some overlap for these stations in Manchester, London and the East Midlands. Global would in effect own Smooth, Heart & Capital in Birmingham – but with Free Radio and Kerrang also broadcasting here, it’s possibly less of an issue for the competition commission. In Manchester, a similar scenario, adding GMG’s current assets would give Global Smooth, Real, Capital, XFM, Gold and Real XS.

Alternatively, Smooth may be disposed of completely by Global. This could certainly make the process easier for them, but wouldn’t offer the opportunity to take the Gold format to a bigger national audience (and, of course, increase revenue). The Smooth brand, available nationally through DAB, also has great assets in its presenters: Simon Bates, Kid Jensen and Pat Sharp.

MEC Opinion: Should the deal go ahead, Global Radio’s portfolio of stations could be massive. Their reported offer of £45-£50m for the Real and Smooth licences is a snip compared with the amount GMG has spent over the last 12 years. It’s only five-and-a-half years since John Myers paid £60m for the two Century stations in the NW and NE (later rebranded as Real). Then add the cost of the two Jazz FM licences in London and Manchester, Scot FM, the Saga stations in the WM, EM, Glasgow and NE, and Q96… and it’s close to £200m.

NB: Currently all reports of offers for GMG’s radio assets are speculation. There has been no official confirmation that this is the case – nor of any offers being accepted.