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In a ruling issued late Tuesday, the Federal Communications Commission said it will allow foreign investors to own an aggregate equity and voting stake of up to 49 percent in Univision, with Televisa and its affiliates allowed to own up to a 40 percent voting stake and 49 percent equity stake.
Televisa, Univision’s main programming supplier, has long sought to increase its stake in Univision. It currently controls a voting stake of about 14 percent and 10 percent of the overall equity of the U.S. Spanish-language media giant. Foreign companies are allowed to own up to 25 percent of a U.S. TV broadcaster, but the FCC said in its ruling that “the public interest would be served by permitting foreign ownership of Univision in excess of the 25 percent benchmark.”
Univision and Televisa made their case for the petition on grounds that a favorable ruling would enhance competition with the top four U.S. networks. The news is also seen as a key decision as Univision has been looking at an initial public offering for a while, which could change Televisa’s ownership stake.
In a joint statement, Univision and Televisa said: “The FCC’s decision will enable Univision to accommodate increased foreign investment that may result from share purchases by the public in an IPO while enabling Televisa (an existing investor in, and business partner of, Univision) to increase its current equity stake in the company.”
Media mogul Saim Haban led a group of investors who purchased Univision for $13.7 billion in 2007 in a deal that took the company private. Televisa invested $1.2 billion in Univision in 2010 to extend a multiyear programming deal.
Univision has seen its primetime ratings drop in recent years as rival Spanish-language broadcaster Telemundo, owned by NBCUniversal, has gained ground. Televisa, which provides Univision with 35 percent of its programming, has been struggling to connect with viewers in Mexico and the U.S. Hispanic market as its steamy telenovelas, once a programming staple, are not to the liking of millennials. Mexico’s top network recently revamped its content offerings, but was forced to cancel several of the new programs after they failed to resonate with young audiences.
Televisa also is grappling with serious competition from streaming service Netflix, which according to El Economista and research firm CIU, controls about 70 percent of Mexico’s OTT market, compared with Televisa-owned SVOD platform Blim’s 18 percent.
The timely ruling also comes just weeks ahead of the inauguration of Donald Trump, who will pick the next FCC chairman.
Trump has had a contentious relationship with Univision after he sued the Spanish-language broadcaster over its decision not to air his Miss USA pageant in light of comments he made about Mexican immigrants while a presidential candidate. He also kicked Univision’s Jorge Ramos out of a press conference after refusing to take the network anchor’s questions on immigration.
After Trump’s victory, Univision CEO Randy Falco said: “I don’t see the election is going to impact Univision in any meaningful way.”
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