The Independent Radio and Television Commission (IRTC) has pulled back from its rejection of UTV's takeover of the Cork radio group, County Media.

Commission members yesterday gave approval in principle to a 60 per cent purchase by the Belfast television firm of County Media a month after it blocked a 100 per cent deal.

They also awarded a local licence to broadcast in Cork to Red Hot FM. Its shareholders include Thomas Crosbie Holdings, which publishes the Irish Examiner, and the businessman Mr Ulick McEvaddy.

In addition, the commission shortlisted four groups for a specialist interest licence in Dublin.

UTV is thought ready to pay about £17.1 million (€21.6 million) to secure a controlling interest in County Media, which operates three local radio stations - 96FM in Cork city and two 103FM stations, in north and south Co Cork.

County's existing shareholders will retain 40 per cent of the company.

They include venture capital firm Delta Partners and three Munster businessmen - Mr Colm O'Conaill, Mr Alex McCarthy and Mr Jim O'Mahony.

UTV's involvement was "positive", the IRTC's chairman, Mr Conor Maguire SC, claimed. Yet he said a majority of "Cork people" would sit on County's board after the takeover.

"In the agreement that was ultimately reached, we're satisfied that a majority of the board would still be local," he said. UTV and County would have two directors each on the board, which would be led by an "independent" chairman.

The commission was happy that this would ensure County's current ethos was preserved, he said. Staffing, studio and programming would not change.

UTV's spokeswoman said it was still clarifying matters with the IRTC and declined to comment further.

Its original bid for 100 per cent of County was worth £28.5 million.

Mr Maguire described the approval of the deal as an "exception" to IRTC rules, which prevent existing media groups taking more than 27 per cent of licences.

This was the largest yet of the "various exceptions" to the rule accepted in the past 10 years.

While rejecting a suggestion that this meant the rules had been changed by default, he said commission members would discuss the guidelines on April 9th.

"The policy has not been changed . . . All aspects of the ownership and control will have to be taken into consideration," Mr Maguire said.

He would not predict what changes commission members might make to the rules because they had conflicting views on the question.

The IRTC's chief executive, Mr Michael O'Keeffe, rejected as "absolutely untrue" a suggestion that its lawyers might have advised against rejecting UTV's initial plan.

"We've never received advice to the effect that we couldn't take the action that we've taken," he said.

When asked whether it was conceivable that UTV would proceed to a full takeover if ownership rules were changed, he said it was.