Univision Communications began its life as a private company last week, with Broadcasting Media Partners completing its $12.3 billion acquisition of the Spanish-language media giant.
Broadcast Media Partners, comprised of Saban Capital Group, Madison Dearborn Partners, Providence Equity Partners, Texas Pacific Group and Thomas H. Lee Partners, now control the biggest Spanish-language broadcast network. Univision television group owns 114 TV and radio stations.
Univision joins the ranks of media companies being purchased by private companies, and the acquisition prompted one member of the Federal Communications Commission to question whether private-equity firms have the financial resources to make a go of it. In a statement, new Univision CEO Joe Uva praised Univision’s former management, saying it had done an exceptional job of building Univision.
“Univision’s programming quality and audience loyalty are second to none, creating unmatched opportunities for advertisers to successfully reach the U.S. Hispanic community,” said Mr. Uva, the former president-CEO of media-buying giant OMD Worldwide.
The Federal Communication Commission Tuesday gave the final OK for the nearly $12.3 billion deal taking Univision Communications private. The decision came only after the Univision agreed to pay $24 million to settle charges that its stations improperly aired soap operas as kids shows, violating childrens’ programming obligations.
The fine, the largest ever for the FCC, had been disclosed early by agency chairman Kevin J. Martin. The charge resulted from challenges to license renewals of Univision’s Cleveland and San Francisco stations filed by the Office of Communication of the United Church of Christ and the National Hispanic Media Coalition. The groups argued the Spanish-language teen telenovelas that Univision aired as children’s programming didn’t qualify as kids shows.
FCC Commissioner Michael Copps while approving the deal expressed some concern about whether the companies buying Univision will have sufficient financial resources.
“I think it is quite significant that today’s transaction involves the transfer of 114 full-power TV and radio licenses from a public corporation—one whose stock is traded on the New York Stock Exchange and is included in the S&P 500—to five private equity firms,” Mr. Copps said.
“The Commission has never analyzed the consequences of this type of transaction for its ability to ensure that licensees protect, serve and sustain the public interest. I, for one, have some real questions about how the assumption of massive amounts of debt will affect a media company’s stewardship of the airwaves.”