Global Radio, Britain's biggest commercial radio owner, today unveiled plans to create a national network of Heart branded radio stations and a new Hit Music group led by its London flagship Capital Radio.

The new structure, aimed at winning back listeners from the BBC and offering a clearer proposition to advertisers, comes as Global combines the former GCap Media and Chrysalis Radio amid a sharp downturn in advertising.

Global will invest £10 million over two years in rebranding, marketing and in new content, although Ashely Tabor, the chief executive, said that bookings were weak. Global Radio, which is privately held does not release figures, but Mr Tabor said that predictions of a 10 per cent fall in advertising across the industry were "not a million miles away".

Mr Tabor indicated that programme budgets, overall, will "probably go up", but money will be saved through an unspecified number of redundancies following the merger of the two sales teams. This will be completed by November 1, when the new structure formally launches.

Global Radio bought GCap Media, owner of Classic FM and Capital Radio, for £375 million in a deal that concluded in August. The company had previously bought Chrysalis Radio for £170 million. Both deals were backed by a group of private shareholders, with funds thought principally to come from Mr Tabor's father, Michael whose personal wealth is estimated at £620 million.

The Heart network will consist of 35 stations, aimed at people in their thirties with a brand that is "sassy, female oriented, but male credible". Most of the former GCap local stations will be rebranded as Heart, adding stations in Oxford, Bristol, Plymouth and Kent to existing Heart stations such as the one in London.

Meanwhile, Capital and other stations in the new Hit Music group will retain their existing names, and will play contemporary music that is aimed at people in their twenties. "You won't hear Chic's Le Freak on Capital; just as you won't hear Kid Rock [an American white rapper] on Heart," Mr Tabor said.

The company will also operate XFM stations in London and Manchester, speech radio station LBC, in London, plus a cluster of Galaxy dance and urban radio stations mainly in the North and in Edinburgh, and a Gold network, playing sixties and seventies hits, broadcasting on AM. Global also owns national station Classic FM.