Chris Wright, the chairman of Chrysalis, is ready to sell the music company that he founded 40 years ago.

However, as the industry veteran said yesterday that he was sitting on a “jewel of a business”, he added that he was sceptical about the prospects of receiving an attractive offer in the present climate.

“We think Chrysalis Music is very very valuable to anybody, and we’re well aware of that,” Mr Wright said. “I think I’d have to listen to any good offer; I only own 27 per cent of the shares, not 100 per cent, and I have to take cognisance of outside investors.”

Chysalis, one of the last big independent music groups, controls songwriting copyrights to acts as varied as Blondie and OutKast and has been valued at around £120 million. Mr Wright has gradually presided over the break-up of the mini-media conglomerate that he built up, which only five years ago comprised television, books and radio as well as music. A series of disposals have reduced the company to music publishing and a small CD and DVD distribution business.

Mr Wright said that he was prepared to wait for a sale, saying that Chrysalis Music could still “afford to work with the best talent in the world” and adding that in an environment of collapsing worldwide music sales he “didn’t know if now is the right time for a knock-out offer”.

At least two of the industry majors have indicated that they are interested in buying up songwriting catalogues. Guy Hands, the Terra Firma boss and chairman of EMI, said in a memo to investors that he saw “potential for consolidation” in the industry. Marty Bandier, the chief executive of Sony/ ATV, is aggressively pursuing deals.

Full-year results for Chrysalis showed that the music division generated £3 million of operating profit, up from £2.3 million, despite turnover falling 7 per cent to £35.1 million. For the first time, revenues from royalties paid when songs are performed exceeded that generated as a byproduct of CD and download purchases.

Jeremy Lascelles, the unit’s chief executive, said he hoped that it would continue to grow because it was “less dependent on physical sales” than recorded music and that “good judgment” would also help to pick the right acts. Recent signings include Johnny Marr, the former Smiths guitarist.

Next month, Chrysalis will formally disburse the proceeds of its radio sale, in a transaction that will see 57½p per share of the current 107½p returned to shareholders. A two-for-five consolidation is then to follow, which if undertaken yesterday, would value the reconstructed shares at 125p each.

Losses before tax widened to £5.9 million from £2.3 million a year ago, including an 11-month contribution from radio. The shares rose ½p yesterday.

Virgin Radio jilts C4

Channel 4’s radio ambitions came under pressure yesterday as a second joint venture partner pulled out of its digital radio consortium. Richard Huntingford, Virgin Radio’s new executive chairman, has axed two “noncore” digital radio stations – one of which was set to launch on Channel 4’s new digital radio multiplex.

Virgin Radio yesterday confirmed that Virgin Radio Viva, the digital radio station for women set to launch on Channel 4’s new digital multiplex, will now not go ahead.

In addition,Virgin Radio Groove, which plays soul, Motown and disco music, is to close before the end of the year.

Times Recommends

• Equitable Life halts £7bn sale on market turmoil
• Potential buyers emerge to save Woolworths staff
• Terrorist attacks close Bombay Stock Exchange