Televisa-Univision is the new combined company, creating a global leader in Spanish-language media with the largest library of owned content, coupled with production capabilities to power its leading TV, digital and streaming platforms. The transaction is expected to close in 2021, subject to customary closing conditions, including receipt of regulatory approvals in the United States and Mexico, and Televisa shareholder approval.
The combination brings together the two leading media businesses in the two largest Spanish-speaking markets in the world: Univision (USA) and Televisa (Mexico). The power and scope of these content assets are unmatched. In 2020, Mexican giant produced +86,000 hours of content across every genre and category, including sports and special events, dramas, newscasts, situation comedies, game shows, reality shows, children’s programs, comedy and variety programs, musical and cultural events, movies and educational programming. Televisa will also contribute its four FTA channels, 27 pay-TV networks channels and stations, its Videocine movie studio and Blim TV SVOD; and the Televisa trademark. These media assets comprise the definitive market leader in Mexico.
The Company will further benefit from Univision’s market-leading assets USA, including the Univision and UniMás broadcast networks, nine Spanish-language cable networks, 61 television stations and 58 radio stations in major US Hispanic markets and Puerto Rico, and prominent digital assets including its recently launched AVOD streaming service, PrendeTV.
The combined entity will have the content, production capacity, intellectual property, global reach and financial resources to aggressively pursue the relatively nascent global Spanish-language streaming opportunity. The Spanish-language market, which represents around 600 million people globally, and an aggregate GDP of about USD 7 trillion, is significantly underserved from a streaming perspective relative to other major markets. Less than 10% of the Spanish speaking population currently use an OTT video product, compared with the English language market where nearly 70% of the population has at least one streaming service.
Emilio Azcárraga, Executive Chairman of the Televisa Board of Directors: ‘This strategic combination generates significant value for shareholders of both companies and will allow us to more efficiently reach all Spanish-language audiences with more of our programming. Together we can more aggressively pursue innovation and growth through digital platforms as the industry continues to evolve. Our new investors at the SoftBank Latin America Fund, Google and The Raine Group are just as excited about the opportunities presented by this combination’.
Wade Davis, CEO, Univision: ‘This transformative combination brings together the leading network serving U.S. Spanish-language audiences with the leading media platform in Mexico powered by the most powerful Spanish-language content engine in the world. Televisa-Univision will emerge as the leading global Spanish-language multi-media company, uniquely positioned to capture the significant market opportunity for Spanish speakers worldwide’.
He continued: ‘The composition of our new investor group reflects confidence in our strategy, the progress of our digital transformation and the magnitude of the opportunity ahead of us. I would like to thank Emilio for his confidence in us, to continue as partners growing the incredible company he and his family have built. I would also like to thank Televisa Co-CEOs Alfonso de Angoitia and Bernardo Gómez for their continued support and partnership as we work together to provide our audience with even more access to even more powerful, compelling and engaging Spanish-language content, however they choose to access it’.
Gómez and de Angoitia: ‘We have been deeply involved with Univision for more than two decades, and we have never enjoyed a better relationship with our partners. We are creating a company which is a leader across multi-media categories, unified over the largest territories and with the scale and focus to deliver the most compelling content experience to Spanish-language consumers around the world. We are confident that this strategic transaction will maximize the potential of our Content segment, while allowing us to strengthen our balance sheet and focus on growth opportunities at our Telecom business’.
‘The SoftBank Latin America Fund is proud to invest in the combination of Televisa-Univision to help create a content powerhouse that can serve the nearly 600 million Spanish-language speakers globally. With the largest and most iconic original Spanish content library in the world and access to SoftBank’s global tech ecosystem, we will help transform the new company into the leading Spanish-language multi-platform digital media company and one of the most important OTT service providers in the world’, explained Marcelo Claure, CEO of SoftBank Group International and board member of Univision.
Davis will lead the combined company, de Angoitia will serve as Executive Chairman of the Televisa-Univision Board of Directors and Claure, CEO of SoftBank International will become Vice Chairman of the Board. After closing, content production and operations in Mexico will continue to be led by Azcárraga, while Gómez and de Angoitia will be Televisa’s Co-Chief Executive Officers.
Televisa will continue to capture the upside from the significant growth potential of the Company by remaining the largest shareholder in Televisa-Univision with an equity stake of approximately 45%. As a part of the agreement, Televisa will retain ownership of izzi Telecom, Sky, and other businesses, as well as the main real estate associated with the production facilities, the broadcasting licenses and transmission infrastructure in Mexico.
Televisa’s content assets will be contributed for approximately $4.8 billion. Under the terms of the agreement, Univision will pay $3.0 billion in cash, $750 million in Univision common equity and $750 million in Series B preferred equity, with an annual dividend of 5.5%. The balance is derived from other commercial considerations. The combination will be financed through $1.0 billion of new Series C preferred equity investment led by the SoftBank Latin American Fund (“SoftBank”), along with current Univision investor ForgeLight LLC, with participation from Google and The Raine Group; and $2.1 billion of debt commitments arranged by J.P. Morgan.
