Two Galway property developers are preparing a bid worth more than €20 million for Galway Bay FM, although they may face competition from UTV and some overseas groups.

Stephen Harris, the managing director of Harrmack Developments, along with another unnamed Galway developer, are understood to be close to tabling a formal bid, The Irish Times has learned. The two men have visited the studios of the station and met senior directors over recent weeks.

The investment in the station would be made in a personal capacity by Mr Harris and his investment partner.

The station yesterday declined to comment on the latest moves.

The bid to be tabled is expected to exceed €20 million. The agent for the sale is Paul Connolly, who runs Connolly Corporate Finance.

While the developers are keen to secure the station, a counter-bidder may emerge. Any proposed sale will have to get the approval of the Broadcasting Commission of Ireland (BCI).

In recent weeks, it is understood that a US firm, RadioDCL, has been in contact with the sellers requesting information about the station on behalf of possible buyers in the US and Asia.

There has also been contact between the station and UTV, although ownership rules from the BCI may prevent UTV from acquiring any further radio assets.

Galway Bay and UTV already have a connection with the UTV-owned company, Broadcasting Media Sales, handling advertising sales on behalf of the station.

Oranmore-based Mr Harris is one of several young developers active in the Galway region. He is the owner of the 12 Pins pub and hotel development in Barna.

The station is likely to fetch a high price because of the strong demographic projections for the Galway area.

However, previous interest in the station from Scottish Radio Holdings (SRH) petered out after SRH was only prepared to offer €12-€13 million earlier this year.

The main shareholder in the station is local Galway businessman Gerry Rabbitte, who has a 30.4 per cent stake. Based on a purchase price of €20 million, he would stand to make over €6 million.

The Connacht Tribune Group is also a major shareholder, with a 27 per cent stake which would give the company a €5.4 million windfall in the event of a sale.

The GAA is a shareholder with 4 per cent stake, while the Catholic Church has a 5.7 per cent stake.

The Western Health Board is also believed to hold a 5.5 per cent interest in the station.

Radio stations around Ireland have been commanding very high prices over the past three years, particularly those in or near the major cities.

The most recent sale was Louth-Meath station LMFM, which was bought by UTV for £7.5 million (€11 million) earlier this year.

Last year Scottish Radio Holdings paid in excess of €30 million for Dublin station FM 104.