The union of Mexico’s Televisa and Univision has been considered by both sides for decades. The impetus to finally make a deal come together was a mutual desire to create a Spanish-language streaming giant serving the U.S., Mexico and the rest of the Spanish-speaking world.
In short, the merger of Univision with most of Televisa’s content and distribution assets in a $4.8 billion deal unveiled April 13 was fueled by the same motivation that brought Disney and 21st Century Fox together in 2019 and sent Viacom and CBS Corp. back down the aisle the same year. Together, the Spanish-language stalwarts have more content and greater reach in their most important markets starting with the U.S. and Mexico.
Wade Davis, Univision CEO who is set to lead the combined Televisa-Univision entity, told Variety that the Spanish-language audience is “the last major streaming market opportunity that is relatively uncontested.” Davis will steer the enlarged company with Televisa co-CEO Alfonso de Angoitia set as executive chairman of the Televisa-Univision board of directors.
Univision already has the fledgling Prende TV ad-supported streaming service which launched March 30 as a collection of 40 live streaming channels offering 10,000 hours of programming. That will eventually be rolled under the umbrella of a broad-based service targeting the estimated 600 million Spanish speakers around the world, Davis and Angoitia said. Televisa will also fold in existing SVOD service Blim TV. And the Mexican media titan is contributing significant brick-and-mortar TV assets, notably four broadcast networks, 27 pay TV channels and its Videocine movie studio.
Ramping up content production to supply to the as-yet-unnamed service and linear networks is a high priority for the combined entity, de Angoitia said.
“We’re principally going to leverage the Televisa production assets. The combined company is going to have an ambitious production agenda,” he said. “We will leverage the infrastructure that Televisa has in Mexico.”
Although Televisa is already one of the world’s largest content production shops, with 86,000 hours produced in 2020, de Angoitia said Televisa stands ready to “expand our capacity for producing.”
The transaction with Mexican corporate giant Grupo Televisa comes just four months after Davis’ ForgeLight Capital completed its purchase of Univision from a group of private equity owners. Davis said he did not plan to orchestrate a merger so quickly with Televisa when he first set out to buy Univision in 2020. But the timing was ripe. The sides have been working on a deal for most of the past year, Davis said.
“It’s a once in a lifetime opportunity to put these companies together at a time when the media business is in transformation,” Davis said. “We have an extraordinary portfolio of assets that are uniquely set up to really go after the global Spanish-language streaming opportunity.”
Davis indicated that Televisa-Univision is studying a mix of free ad-supported channels and subscription options as it develops the larger platform that aims to launch in early 2022. Davis said there will be more details to come after the partners seal their transaction which is expected to close this year.
“Look at what we did with Prende as the early signs of how we’re thinking about the market,” Davis said. Univision’s strong footprint in the Spanish-language market helped that free app get off to a strong start with its target audience. “It launched a little more than two weeks ago and already it’s a top 20 entertainment app regardless of language,” he said.
(Pictured: Wade Davis, Alfonso de Angoitia)
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