LONDON (Reuters) - Rupert Murdoch’s News Corp (NWSA.O) has agreed to buy the owner of Britain’s talkSPORT in a $292 million deal that unites The Sun newspaper’s sports coverage with the commercial radio network that broadcasts Premier League and FA Cup soccer.
News Corp CEO Robert Thomson said the Wireless Group WLG.L station’s 3 million-strong weekly audience was a great match with the readers of its tabloid, Britain’s most popular newspaper, with a daily circulation of 1.7 million in April.
He said the deal - a week after Britain shocked markets by voting in a referendum to leave the European Union - was a “clear sign of our commitment to, and belief in, the United Kingdom as a place to do business successfully and profitably”.
News Corp, which also owns The Times newspaper in Britain and the Wall Street Journal, is looking to diversify as print revenues decline due to a shift to digital media.
Rebekah Brooks, CEO of Murdoch’s UK newspaper business, said the companies’ brands, including a forthcoming Sun betting offer, could be promoted across print, online and radio after the deal.
The 220.3 million pound ($292 million) transaction also offered more opportunities for sponsorship and cross-media campaigns for advertisers, she said.
The drop in the value of the pound to a 31-year low on Monday after the “Brexit” vote - a decision welcomed by Murdoch according to reports - sweetened the deal for the U.S. buyer.
“Clearly it’s a deal that’s been in the works for a while, but it’s quite fair to say that the decline in the pound is auspicious in the circumstances,” Thomson said.
He declined to speculate on whether other Murdoch companies could exploit the drop in the pound and a fall in some share prices to do more deals, such as 21st Century Fox (FOXA.O) buying the near 61 percent of Sky SKYB.L Murdoch does not own.
The Sun and the Sunday Times backed Brexit while The Times came out for “Remain” in a vote that split Britain, forced the resignation of its prime minister, wrenched apart the ruling Conservatives and opposition Labour, and caused market turmoil.
Brooks said News UK’s titles had reflected the views of readers. “They presented the campaign incredibly well, but as to what influence they had I just don’t know,” she said.
She added the battle for leadership of the Conservative party was “going to be great for newspapers”.
Wireless Group shares rose as much as 70 percent to the cash offer price of 315 pence on Thursday. They closed at 310 pence.
Wireless, which employs 769 people, reported revenue and operating profit from continuing operations of 75 million pounds and 13 million pounds respectively last year.
Lepe is News Corp’s financial adviser for the deal, while Numis and Goodbody are advising Wireless.
($1 = 0.74 pounds)
Additional reporting by Rahul B; Editing by Kirti Pandey and Mark Potter