Ulster Television's (UTV) bid to take over County Media Ltd, owner of three independent radio stations in Cork city and county, has been rejected by the Independent Radio and Television Commission.

UTV had sought to acquire the entire shareholding of County Media for £31.5 million (€40 million), but the IRTC announced in Cork yesterday that the bid had failed because to allow the take-over would have involved a fundamental change in its policy. Under IRTC rules, an existing media outlet is barred from holding more than 27 per cent in another media concern. "A change of this nature would only be considered in the context of a full review of policy in this area," the IRTC said in a statement.

It added that under the Radio and Television Act 1988 it was required to have regard to, among other things, the character, expertise and experience of an applicant and that its policy was to favour a strong local representation in the ownership structures of local radio services.

Had it gone ahead, management at County Media had promised the 100 full-time and part-time staff at 96FM in Cork, the city's only independent radio station, to share £1 million of the proceeds. Last night a 96FM spokesman said the station would not be commenting until the IRTC's decision had been fully assessed. In a separate statement, UTV said: "We haven't received notification from the IRTC yet as to the rationale for their decision. As I am sure you will appreciate, it is important that we receive this clarification before we decide on our next move."

Although it would not comment any further on the Ulster Television bid for County Media, the IRTC indicated that a policy review was on the agenda for its next meeting to be held in April. After this, it may be possible for UTV to resubmit its bid.

The IRTC was in Cork yesterday to hear submissions from three concerns interested in operating a second independent radio station in the city. They are: Magic FM, which includes Radio Kerry, Lite FM and Fox Radio; Beat FM, a consortium which includes Today FM, Liberty Asset Management and the Manchester United footballers, Roy Keane and Denis Irwin; and Red Hot FM, a consortium including Thomas Crosbie Holdings, owner of the Irish Examiner, and FM104. The decision on the second licence is expected to be announced on February 26th.