Below are some excerpts from The Wall Street Journal's coverage of the sale of Spanish-language media company Univision.
---
The Wall Street Journal
June 28, 2006
Investor Group Snags Univision; Televisa Fumes
By MIRIAM JORDAN, DENNIS K. BERMAN and JOHN LYONS
-- Merissa Marr contributed to this article.
June 28, 2006
The chaotic auction of Spanish-language broadcaster Univision Communications Inc. has resulted in an equally tumultuous outcome.
Univision yesterday confirmed its planned sale to a consortium of private-equity investors who will pay $12.3 billion and assume $1.4 billion in debt. But in doing so, Los Angeles-based Univision appears to have further rankled an important business partner it had already been feuding with: Mexico's Grupo Televisa SA, the company that provides much of the popular programming that has made Univision the dominant Spanish-language TV network in the U.S.
Televisa, which already owns 11% of Univision, led a group that made a competing bid for Univision. For weeks, it was expected to win the deal, fulfilling Televisa Chief Executive Emilio Azcarraga Jean's dream of controlling the U.S. media asset. After losing the deal early yesterday, people close to Televisa complained bitterly that Univision and its controlling shareholder -- billionaire A. Jerrold Perenchio -- had ignored its bid, failing to discuss it even though the bid was very close in value to the winning offer.
...The winning bid came from a private-equity group made up of Texas Pacific Group Inc., Thomas H. Lee Partners, Madison Dearborn Partners LLC, Providence Equity Partners Inc. and media mogul Haim Saban. The private-equity partners are contributing $900 million, with $250 million coming from Mr. Saban, and financing the remainder. The consortium didn't speak publicly about how it plans to operate Univision, which consists not just of the highly rated broadcast network, but also sister network TeleFutura, 73 radio stations and several record labels.
The acquiring group's winning bid of $36.25 per share came after an earlier offer of $35.50 was rejected. Televisa and partners Bain Capital and Cascade Investment late last week offered $35.75, but in a prepared statement Televisa said, "repeated offers to discuss all
aspects of our proposal including price" were disregarded.
Both offers were well below the $40 per share Mr. Perenchio initially sought when he put the company on the auction block in February. Nonetheless, the press-shy Mr. Perenchio in a written statement characterized it as a "blockbuster transaction." Mr. Perenchio himself stands to reap $1.4 billion in the transaction, a giant windfall from the $33 million he invested in the company 14 years ago.
This blockbuster immediately faces complex problems, however. Televisa said it has "a number of options it is considering." Those could include taking legal action against Univision, presenting a new bid or somehow moving its programming to new broadcasting venues. People close to the matter said the winning bidders left room in their final documents to bring Televisa into the deal, but Televisa was steadfastly opposed.
"We've made a decision, and we're not going to join the winning bidder. We're not going to bail that consortium out of the deal that it made," the Televisa spokesman said.
Univision and Televisa have a fractious history together. Mr. Azcarraga's grandfather, who got his start buying radio stations, started assembling the network of U.S. TV stations that eventually became Univision in the 1970s after being surprised by the almost total lack of Spanish-language programming in the states at the time. Mr. Azcarraga's father, a flamboyant man who went by the nickname El Tigre, was forced to sell the network in the late 1980s after a fight with U.S. regulators who charged that he was in violation of foreign-ownership limits of media companies.
...
No comments:
Post a Comment