Murdoch fund takes full ownership of DMG Radio Australia

According to a DMGT filing with the London Stock Exchange, Illyria will pay A$100 million ($100 million) in cash and a further sum equivalent to 50% of the final DMG Radio Australia dividend for the year ending September.

DMGT will use the proceeds of the sale to reduce debt. Martin Morgan, the company's CEO, said that it was an appropriate time to realize the value created by DMG Radio Australia's improved performance, adding that the transaction is part of a wider DMGT strategy to consolidate its portfolio of assets.

Illyria first invested in DMG Radio Australia in November 2009, reportedly paying A$110 million, and has since assisted the company in developing online and digital businesses. Revenue for the year to September 2011 came to A$123 million, compared to A$94 million a year earlier, while operating profit reached A$5 million.

Lachlan Murdoch said that DMG Radio Australia's EBITDA has doubled since Illyria became involved, and the IRR on the investment is more than 60%. "In that time, Nova has regained its position as the number one national network for people 18-39 and we have successfully launched SmoothFM," he added.

Illyria, which Murdoch set up in 2005 shortly after resigning as an executive at News Corporation, the media company controlled by his father, also owns 9% of Australia's Ten Network Holdings. Earlier this year, Ten Network sold Eye Corp, its outdoor advertising business, to CHAMP Private Equity's oOh!media.

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• Topics
• Media
• Australasia
• Buyouts
• Australia
• TMT
• buyout