8 May 2008 UBC Media Group plc (“UBC”), the supplier of audio content and broadcast data software to the radio industry in the UK, announces that it has signed a letter of intent (the ‘LOI’) with Global Traffic Network, Inc. (“GNET”), a Nasdaq listed leading provider of custom traffic and news reports to radio and television stations outside the U.S., under which GNET has agreed, subject to contract and UBC shareholder approval, to acquire the Commercial Division of UBC Media Group plc (“UBC”) via a purchase of the share capital of a wholly owned subsidiary of UBC. Pursuant to the terms of the LOI, it is intended that GNET will acquire UBC’s Commercial Division for £15 million, of which, £1 million may be satisfied in the form of Global Traffic Network stock at GNET’s sole option. The commercial division of UBC supplies traffic, news and entertainment information to approximately 250 radio stations in the United Kingdom in exchange for commercials that are then sold to advertisers. The planned acquisition is subject to completion of due diligence and negotiation of a mutually acceptable share purchase agreement and is expected to close, subject among other things to approval by UBC’s shareholders, on or before 31 July, 2008. Upon entry into the letter of intent, GNET deposited £350,000 into an escrow account, which amount will be credited towards the cash purchase price upon closing of the transaction. The deposit is refundable if either UBC elects not to proceed with the transaction or if GNET elects not to proceed with the transaction based on the failure of UBC to satisfy certain conditions specified in the letter of intent. The deposit will be forfeited by GNET if it elects not to proceed with the transaction for other reasons. Subject to specified exceptions, GNET has agreed not to solicit the customers of UBC’s commercial division for a period of six months following any election by the Company not to proceed with the transaction, regardless of the reason. Simon Cole, Chief Executive of UBC commented: “The Commercial team at UBC has spent 12 years building up the leading networking business in the UK and now it is time for that to be part of a bigger international operation. I’m absolutely delighted to be working with Global Traffic Network to make that happen and to demonstrate to shareholders the value of what we have created. The UK radio market is developing very fast as consolidation takes hold and I am very confident that GTN can look forward to maintaining and building the strong business we have developed here.” William L. Yde III, Chairman, Chief Executive Officer and President of Global Traffic Network, commented: “We are extremely excited about the acquisition of the commercial division of UBC, as it will dramatically increase our footprint in the United Kingdom, adding approximately 250 radio stations throughout the United Kingdom. With approximately $22.7 million in annual revenues and approximately $1.8 million net contribution after overhead, the acquisition not only significantly expands our business in the UK, it dramatically increases the size and scope of Global Traffic Network as a whole. The stations currently serviced by the commercial division of UBC have a non-duplicated reach of approximately 16.7 million listeners weekly, which is greater than our combined reach in Australia and Canada.” Mr. Yde continued, “While we are paying a premium for Unique, we believe that there are significant synergies with both our existing business and our Traffic Radio Service Contract with the United Kingdom Highways Agency that is set to launch on July 1, 2008. We also believe there is significant upside in the current station contracts and potential to add additional stations to our expanded UK operation. We have always seen the UK as a huge opportunity for us, and we believe this acquisition is the best strategy to take advantage of that opportunity.” Closing of the contemplated transaction will be contingent upon, among other things, satisfaction by GNET of its due diligence investigation, as well as the parties’ negotiation and execution of a formal definitive purchase agreement (containing warranties, representations, indemnities, covenants, conditions and other terms customary for a transaction of this size and nature) and consent in general meeting from UBC’s shareholders if required. The Company will post an appropriate circular to shareholders containing a full description of the terms of the definitive purchase agreement and a notice convening an extraordinary general meeting of shareholders to approve the transaction as and when detailed terms have been agreed. The Board of UBC is intending to conduct a strategic review of the business following this transaction. The Company is reviewing the timetable for the preliminary announcement of its Final results in the light of this transaction and will advise the market of the intended date for publications in due course. ENDS Enquiries: Simon Cole, CEO UBC Media Group: 020 7453 1600 or simon.cole@ubcmedia.com Verity Williams, Portland for UBC: 020 7404 5344 or verity.williams@portlandpr.co.uk Mark Percy/Sarah Jacobs, Seymour Pierce: 020 7107 8000 About UBC Media Group UBC is quoted on the London Stock Exchange's AIM market. The Group is the market leader in the supply of audio content and broadcast data software to the radio industry in the UK. In addition to the entertainment, traffic & travel and national news services provided to commercial radio, the Group is the largest independent producer of radio programming for the BBC and the UK's leading supplier of digital radio scrolling text and EPG software. It is also part of the MXR Regional Multiplex consortium, the 4Digital National Multiplex consortium and has recently launched ‘Cliq’, a service that creates an e-commerce platform for radio. www.ubcmedia.com About Global Traffic Network Global Traffic Network, Inc. (Nasdaq: GNET) is a leading provider of custom traffic and news reports to radio and television stations outside the U.S. The Company operates the largest traffic and news network in Australia, operates traffic networks in seven Canadian markets and has recently commenced operations in the United Kingdom. In exchange for providing custom traffic and news reports, television and radio stations provide Global Traffic Network with commercial airtime inventory that the Company sells to advertisers. As a result, radio and television stations incur no out-of-pocket costs when contracting to use Global Traffic Network’s services. For more information, visit the Company’s website at www.globaltrafficnetwork.com
2008-05-08 09:40:22
Go Back |
