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Bauer, a private company which owns 166 magazines across three continents, will acquire the UK's second biggest consumer magazine and radio group, if the deal is approved by a special shareholder meeting in January.

Emap's shares fell 4.67% this morning to 786.5p, around the same level they were at when a review of its operations was announced on July 16. Emap shares have fallen by almost 60p in the last week, having opened at 844.5p

At first sight, the outcome is a positive result for Emap shareholders, with the magazines division selling for £718m compared to its rough valuation of £700m. The radio division will go for £422m compared to its rough valuation of £400m.

The company said it intends to return £1bn, or 460p per share, to shareholders.

However, the result is a major reversal not only for the three bidders pursuing the B2B division, which included the team of Guardian Media Group and Apax, but also for Global Radio, which was set on a transformational deal for Emap's radio assets, which include Kiss and Magic FM.

Ashley Tabor, chief executive of Global Radio, said: "Emap's strategic decision to proceed with a single bid for radio and consumer mags together, is understandable if disappointing for radio specific bidders in the process. Global Radio is committed to the future and long term consolidation of the UK radio industry."

Bauer's acquisition is surprising as the industry did not expect what is a relatively small UK publisher of traditional women's weeklies to move on its much larger rival.

Furthermore, it is unusual that Bauer is expanding into radio, as its business is focused on magazines.

Alun Cathcart, the executive chairman of Emap who called the review, hailed the deal as a "successful outcome".

"Emap will now be a focused B2B company with strong market positions, strong cash flow and a proven management team and track record in delivering value and growth," he said.