TORONTO — CanWest Global Communications Corp. has agreed to buy New Zealand’s third-largest radio network, More FM, for NZ$33 million ($22 million) in cash.
Winnipeg-based CanWest said it has been eyeing the radio market in New Zealand for some time. More FM owns two FM stations in Auckland, one of them launched just this month; three in Wellington; one in Christchurch; and one in Dunedin, launched in May.
The purchase price was “at a very favorable multiple (of cash flow) for CanWest,” said Gerry Noble, vice president of operations.
Managing director Doug Gold and chairman Craig Thomson, who founded More FM in 1991, have agreed to stay on in senior operating roles .
New Zealand’s radio industry, dominated by five major radio groups that battle 50 other radio operators for market share, has been in the throes of consolidation for the past 18 months.
The New Zealand government has sold its commercial radio network, Radio New Zealand Ltd., and its new owner, Irish media mogul Tony O’Reilly, has merged it with the second-largest group to create the Radio Network, which commands 60% of the national radio market. Overall, the radio market generates about $109 million a year.