Global takeover of GCap looks likely

The board of Capital 95.8 owner GCap has said it will "work together" with takeover suitor Global Radio - making a deal look increasingly likely.

GCap also agreed to give Global another three weeks to come to an agreement. It said in a statement: "We will work together with Global to determine whether it will be able to make a recommended offer."

The change of tack comes after Global, chaired by former ITV chief Charles Allen, made a third offer of 225p per share. It valued the company at around £371m and analysts said it would be hard to resist.

Global has said its "final proposal offers cash and certain value today compared with the inherent execution risk in GCap's strategy".

Ashley Tabor, Global's chief executive, welcomed the development: "We are delighted that the GCap board has made it possible for Global to work towards finalising an offer that will create substantial value for GCap’s shareholders."

He said a deal would "create a strong and vibrant company that will be able to breathe new life into Britain’s commercial radio sector".

Fru Hazlitt, Gcap's recently appointed chief executive, has attempted to avert a takeover with proposals to improve performance by cutting costs, including the closure of two digital-only stations.