Pierre Fabre SA Exits Radio, Selling Sud Radio to Group of Independent Owners

Michael Hedges June 9, 2005

French pharmaceuticals company Pierre Fabre was a major participant in privatizing French radio broadcasting in the 1980’s.

Independent radio group Sudporters, the intended buyer, is composed of station owners Alouette FM, Scoop and Start Radio, owner of Ado FM and Vibration. Start Radio will become the majority shareholder when the transaction is finally approved by the Conseil supérieur de l’audiovisuel (CSA).

Sud Radio is based in Toulouse, covers most of the south of France and currently employs about 100 persons. Also included in the transaction is local Bordeaux station Wit FM. In addition to Sud Radio, the Pierre Fabre once owned Radio Monte-Carlo and network Nostalgie. Its Sud Communications subsidiary holds 78% of Sud Radio.

When told last Wednesday of the station’s proposed ownership change union employees went out on strike. Union spokesperson Christine Bouillot said employees wanted “assurances that Sud Radio remains Sud Radio.”  The strike was suspended Monday (June 3) and normal broadcasting resumed the next morning. Only music and commercials were broadcast during the strike.

Sud Radio originated as Andorradio, owned by SOFIRAD (Société Financière de Radio) and operating from the Principality of Andorre. Andorradio launched in 1958 as a competitor to Radio Andorre. Launched in 1958 as a competitor to Radio Andorre – one of the original four radios perferique – Andorradio changed its name to Sud Radio in 1966. SOFIRAD – a state-owned broadcasting company – began privatizing in 1986 with the sale of Europe 1 to Hachette. Sud Radio and Radio Monte-Carlo (RMC) were sold to Pierre Fabre SA, a company with broad holdings in the south of France, in 1987. SOFIRAD was dissolved in 1998 after the sale of RMC.

NRJ Groupe bought RMC from Pierre Fabre in 2000, acquiring the Nostalgie network, spinning off the rest to a new company, Nextradio, formed by former NRJ president Alain Weill. Nextradio rebranded RMC as RMC Info.

Sud Radio’s 2004 revenue was reported as €11.2 million.  Sud Communications owns French photo agency SIPA, purchased in 2001. With its’ exit from Sud Radio, Pierre Fabre SA leaves French radio broadcasting, largely, to media companies. Of the major media owners, only Lagardère has significant non-media interests.

“Sud Radio stayed in a very generalist model,” said Alouette FM director and Voltage FM president Bertrand de Villiers, reported by AFP. “We will adapt their format and evolve things with the current team.” de Villiers is brother of Movement for France (MPF) party president Phillippe de Villiers.  Sud Radio’s national market share recently fell to less than 1%.

Audience caps effectively prevent expansion by the three major private French radio companies. NRJ Groupe, Lagardère and RTL Groupe own 11 of the 13 major radio networks. Only Skyrock and RMC Info – among privately owned channels licensed for national coverage - are owned independently. In recent years French local and regional stations have benefited from market fragmentation, better programming and a slight shift in ad spending from national to local markets.

The inferiority complex long plaguing local French private radio is giving way to a sense of new strength. The national market share for independent, largely local radio has risen to 12%, still modest in comparison with the major networks. Sud Radio’s new owners – all operating successful local stations – are primed to take advantage of shifts in the French media market.