DMG takeover speculation in Far North Queensland

Townsville marketing organisation ‘Townsville Enterprise’ is worried by speculation that DMG stations in North Queensland might be taken over by Macquarie Bank. The organisation’s CEO Glenys Schuntner raised the issue with Shadow Communications Minister Lindsay Tanner when he was in the region last week.

Schuntner says any takeover of DMG Regional Radio will “lead to job cuts and a loss of identity for local commercial radio stations.”

She says “speculation is rife” that Macquarie Bank’s regional media fund has begun due diligence on a bid to acquire DMG. Macquarie has already announced its intention to buy RG Capital Radio and a shareholder meeting is expected to ratify that purchase next month.

In Townsville RG Capital owns Sea FM and MIX 106.3, while DMG owns HOT FM and 4TO FM. A little further north in Cairns RG Capital has one station, Sea FM, while DMG owns 4CA and Hot FM.

AMI stations in each town provide programming for the older demographics and ABC Radio broadcasts its main networks into the region. There are also a number of community radio stations and narrowcasters in the Far North Queensland region.

Sea FM Cairns just celebrated its 5th birthday, while SEA and Mix in Townsville have been operating for a longer period of time. The former AM ‘heritage’ stations in both markets, 4TO and 4CA are both owned by DMG.


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Schuntner says she has “serious concerns” that a concentration of ownership would cost jobs and reduce competition.

“Our concern is that any takeover will lead to an amalgamation of resources – particularly in administration, programming and sales – and massive job losses.

“What happens if the Macquarie Group decides that all the local stations can be run from a Brisbane base? The obvious answer is that local people will be laid off.”

While Glenys Schuntner is clearly championing her local region, her understanding of radio regulations leaves a little to be desired.

If Schuntner’s scenario does come true, Macquarie Bank would be required to divest some stations because of the two-to-a-market rule within 12 months of the purchase.

In another move that could also affect any future takeover, the ABA recently released new guidelines from the Communications Minister for Revisiting Radio Licence Area Plans if there is a change of ownership. These new guidelines could be applied if there were any significant format changes as a result of a takeover.

The Minister’s direction says that the ABA “must consider whether to exercise its power to vary a licence area plan where, within three years of a change in control, a commercial radio program format changes from one of broad appeal to one of more limited appeal, and the change results in a reduction in the number of broad appeal services in a licence area.”

The purpose of the Minister’s Direction is to ensure that changes in control of commercial radio licences do not lead to reductions in the diversity or range of services available within relevant licence areas (click below for full details).

The expansion of Macquarie Bank’s regional media fund will continue to interest the radio industry while DMG focuses on the expansion of its Nova network and RG Capital is still in play, but informed sources have told radioinfo that Macquarie Bank watchers should also keep their eyes on the group’s interest in regional tv rather than assuming it will just focus on radio.

radioinfo has also heard from DMG staff sources that “bankers” have come to look at some of the group’s stations and that staff in some stations have been warned to expect changes.

It is unlikely that DMG or Macquarie Bank would be able to comment on any speculation about what the future may hold, due to guidelines in both the UK and Australia that restrict companies from talking up their share price and prospects.