Disposal

 

TIDMTLR 
 
RNS Number : 4734Q 
Local Radio Company PLC (The) 
09 April 2009 
 

 
 
9 April 2009 
 
 
THE LOCAL RADIO COMPANY PLC ("LRC" OR THE "COMPANY") 
 
 
SALE OF JAZZ FM BUSINESS 
 
 
Following a strategic review, and as referred to in the Open Offer document 
posted to shareholders on 6 March 2009, the Company today announces the sale by 
it and Trinity FM Limited ("Trinity") of its Jazz FM business to Jazz 
Investments Limited, a company established by Richard Wheatly (a former director 
of the Company and Trinity) and Alistair Mackenzie (a former director and 
employee of the Company). 
Trinity had, since 1 October 2008, operated a radio service and website known as 
Jazz FM on behalf of GMG Radio Holdings Limited ("GMG") under a three year 
operating agreement with GMG (the "Jazz FM Business"). 
Under the terms of the operating agreement with GMG the Company guaranteed the 
obligations of Trinity under that operating agreement. The Company also owned 
certain assets and was party to certain contracts used in or required for the 
operation of the Jazz FM Business. 
The consideration received by the Company and Trinity for the disposal of the 
Jazz FM Business is GBP1 together with the assumption by Jazz Investments 
Limited of Trinity's liability to GMG of GBP195,510 which would otherwise have 
been due to be discharged by Trinity on 31 March 2009.Also, as a consequence of 
the disposal of the Jazz FM Business Trinity has avoided incurring redundancy 
related expenses of approximately GBP258,000. The assumption by Jazz Investments 
Limited of the liability to GMG as part of the consideration for the disposal of 
the Jazz FM Business and the avoidance of those redundancy related expenses 
improves the Company's cash flow position which (following the Company's general 
meeting on 1 April 2009 at which the proposed open offer to raise approximately 
GBP1.51 million (before expenses) for the Company did not receive sufficient 
shareholder support to proceed) the Board continues to review carefully. 
In the period from 1 October 2008 to 31 March 2009 the Jazz FM Business operated 
at a loss of GBP733,000 and the assets used in, and disposed of with, the Jazz 
FM Business have a book value of GBP61,000. 
For the purposes of Rule 13 of the AIM Rules for Companies, the Board, having 
consulted with its nominated adviser, Ruegg & Co Limited, considers that the 
terms of the sale of the Jazz FM Business are fair and reasonable in so far as 
the Company's shareholders are concerned. 
For further information please contact: 
 
 
Rhys Davies 
The Local Radio Company plc 
Tel: [phone] 
 
 
Roxane Marffy/Brett Miller 
Ruegg & Co Limited 
Nominated Adviser & Broker 
Tel: [phone] 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
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