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Hispanic-media firm sees no immediate takers
Univision Explores Sale
John M. Higgins
Spanish-language TV and radio company Univision Communications has hired investment banker UBS to help it "explore strategic alternatives," most likely to sell the company. An auction could allow one of the buyers overnight to become the most powerful force in Hispanic media, dominating the fastest-growing segment of the U.S. population.
But with some price tag estimates of $13 billion, a deal would be a big bet on a company that has plenty of problems. For all the hype about advertisers' increasingly trying to reach Hispanics, Univision has had many of the same problems selling advertising as plain-old English-language TV- and radio-station owners. For a year, it has struggled to meet revenue expectations, and demand is so limited that, even in good times, the network manages to sell just half of its available inventory.
Further, the network is dependent on programming from Emilio Azcarraga , CEO of Mexican broadcaster Televisa , whose company owns 26% of Univision and is battling the U.S. network in court to break a long-term supply agreement. Any buyer will have to deal with Azcarraga and possibly partner with him.
Wall Street and industry executives see an array of possible buyers, but the limits on ownership of TV stations is a major complication. Sumner Redstone , chairman of Viacom and new spinoff CBS , has long expressed interest in the Spanish-language company, but CBS is already at federal ownership limits and would have to significantly prune its holdings to acquire Univision's portfolio.
Tom Freston , who runs the Viacom half of Redstone's empire, might be attracted because his MTV Networks is built around serving niche cable audiences. But buying such a big portfolio of TV and radio stations would be a major leap. Also, because Redstone controls both Viacom and CBS, Freston might run into the same problems as CBS CEO Leslie Moonves .
It's hard to see Time Warner making a major acquisition in the midst of its fight with activist shareholder Carl Icahn , and News Corp. Chairman Rupert Murdoch doesn't sound very interested. "We don't have any specific intentions," he said Wednesday, "and at the prices I've heard thrown around, we have no intentions."
The wild card...