Capital Radio owner Gcap Media has rejected a £310 million takeover bid from rival Global Radio, sending its share price up 50% to 182.5p.

The UK's biggest commercial radio station spurned the 190p per share cash offer on the grounds that it unvalued the company.

Global Radio, whose stations include Heart and Galaxy, said it is 'considering its position' in response to GCap's rejection of
its offer.

The approach comes only weeks after Gcap Media appointed a new chief executive, Fru Hazlitt. The former Gcap London managing director is expected to outline a new strategy for the business this month.

Gcap Media was created by the £711 million merger of Capital Radio and GWR in May 2005. It has struggled with weak trading and falling audiences, although it has recently shown some signs of improvement.

Hazlitt, formerly chief executive of Virgin Radio, was appointed to run GCap's flagship radio station Capital Radio last May.

Global Radio said any offer would be conditional on a recommendation from the GCap board and due diligence.

Stockbroker Numis said Global Radio could afford to pay a high premium because of 'significant synergies' and cost saving opportunities in merging the companies.

'We would not underestimate the challenges of turning round GCap on a standalone basis,' said Numis analyst Lorna Tilbian. 'Moreover, we believe a cash bid in an uncertain advertising environment for a business facing structural challenges has considerable merit.'