CAP Clean Air

RNS Number:1697J
Capital Radio PLC
17 April 2000


  Not for release, publication or distribution in or into the USA, Canada,
  Australia or Japan
                                                                              
                                                                              
                    CAPITAL RADIO PLC AND GRANADA GROUP PLC
                   STRATEGIC ALLIANCE FOR BORDER TELEVISION
                                       
  Capital Radio plc ("Capital Radio") and Granada Group plc ("Granada") have
  signed an agreement for Granada to buy the television assets of Border
  Television ("Border") for a cash consideration of #50.5 million, subject to
  the successful completion of the acquisition of Border by Capital Radio.
  
  Border and Granada have significant long-standing commercial agreements
  whereby Granada handles airtime sales and transmission for Border.  Under
  the terms of this agreement, Granada will have the right to acquire from
  Capital Radio, and Capital Radio the right to sell to Granada, Border's
  television assets ("the assets") for a period of three years following the
  completion of the acquisition of Border by Capital Radio.
  
  The agreement includes an exclusivity clause, which states that Granada
  cannot negotiate with any other party, regarding the purchase of the assets
  for a period of 6 months from the date of this announcement.
  
  David Mansfield, Chief Executive of Capital Radio, said:
  
  "This agreement further strengthens our bid for Border.  It protects the
  long term future of Border's television business with a Group which is
  committed to the development of television assets and enables Capital to be
  totally focused on doing what we do best - building successful radio
  businesses."
  
  Charles Allen, Chief Executive of Granada, said:
  
  "This is a good deal for our shareholders and reinforces our determination
  to be at the forefront of ITV consolidation.  We have the option to buy
  Border Television and we will extend our long-standing commercial agreement
  with Border Television."
  
  A summary of the agreement is attached.  Capital Radio is being advised by
  Credit Suisse First Boston and Granada by Lazards.
  
  ENQUIRIES
  
  Capital Radio                             Granada    
  020 7766 6288                             020 7451 3000
  David Mansfield, Chief Executive          Charles Allen
                                            Susan Donovan, Granada Media
  
  Credit Suisse First Boston                Lazard
  020 7888 8383                             020 7588 2721
  Anthony Fry                               Nicholas Shott
  
  Finsbury                                  Citigate Dewe Rogerson
  020 7251 3801                             020 7638 9571
  Rupert Younger                            Simon Rigby
  James Leviton
  
  
  Credit Suisse First Boston (Europe) Limited, which is regulated by The
  Securities and Futures Authority Limited, is acting exclusively for Capital
  Radio and for no one else in connection with its offer for Border ("the
  Offer") and will not be responsible to anyone other than Capital Radio for
  providing the protections afforded to customers of Credit Suisse First
  Boston (Europe) Limited nor for providing advice in relation to the Offer.
  
  Lazard Brothers & Co Limited, which is regulated by The Securities and
  Futures Authority Limited, is acting exclusively for Granada and for no one
  else in connection with the transaction referred to in this announcement
  and will not be responsible to anyone other than Granada for providing the
  protections afforded to customers of Lazard Brothers & Co Limited nor for
  providing advice in relation to the transaction.
  
  This announcement does not constitute an offer or invitation to purchase
  any securities.
  
  
                      APPENDIX:  SUMMARY OF THE AGREEMENT
  
  
  1. Exclusivity: Granada cannot negotiate with any other party, other than
     Capital, regarding the purchase of the assets for a period of 6 months
     from the date of this announcement.
     Capital Radio cannot negotiate with any other party regarding the sale of
     the assets for a period of three years following the completion of the
     acquisition of Brown.
  
  2. Put & Call Options:  The agreement provides for the following:
     -    Granada has the option to purchase the assets at any time during the
          three year period following completion of the acquisition of Border
          by Capital Radio ("the call option")
     -    Capital Radio has the option to require Granada to purchase the
          assets at any point during the two year period following the first
          anniversary of the completion date ("the put option")
     -    These options are subject to Granada's acquisition of the assets
          receiving all necessary regulatory clearances.
     -    At the end of the three year period, Capital Radio has the right to
          sell the assets to Granada irrespective of any regulatory issues,
          with the transaction being completed within six months.  If Granada
          does not purchase the assets at this point, it has undertaken to
          find an alternative purchaser.
     -    The consideration payable under the put and call options is subject
          to adjustment by reference to completion accounts.
  
  
  3. Airtime Sales and Transmission Contracts:  This agreement confirms that
     Border will continue these contracts as part of the Capital Radio Group
     for a minimum period of five years.
  
  
  4. Granada's Undertakings in relation to Capital Radio's bid for Border:
     Granada has undertaken not to buy any Border shares or make an offer for
     Border unless Capital Radio's offer for Border lapses.
  
  
END

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