By Anthony Harrup
MEXICO CITY--Mexican broadcast and media company Grupo Televisa
SAB and U.S. Spanish-language broadcaster Univision Holdings Inc.
said Thursday they intend to extend their program licensing
agreement and increase Televisa's voting rights in Univision, as
the U.S. company makes plans to go public.
The two companies signed a memorandum of understanding that will
extend the licensing agreement from its current 2025 to at least
2030.
The agreement came as Univision filed a registration for an
initial public offering. The company said the amount of shares to
be sold and price range for the offering have yet to be
determined.
The extension is subject to Univision completing the IPO with no
change of control in the company.
Univision has exclusive broadcast and digital rights in the U.S.
to Televisa's content, including soap operas, sports, sitcoms and
reality shows.
The pact also includes changes in the way Univision calculates
royalties due to Televisa. Univision will include some additional
revenue sources, while Televisa agreed to lower the percentage it
receives. Televisa, the world's biggest producer of
Spanish-language television programming, received $313.7 million in
royalties from the U.S. broadcaster in 2014.
Televisa, which has around a 36% economic interest in Univision,
including direct shares and convertible notes, will exchange $1.125
billion in notes for warrants, lowering Univision's debt by that
amount and reducing its annual interest payments. Univision will
pay Televisa $135.1 million for the conversion.
The changes will give Televisa around 22% of Univision's common
stock with voting rights.
Televisa shares were up 0.8% early Thursday at 122.33 pesos
($7.81) on the Mexican stock exchange.
Write to Anthony Harrup at anthony.harrup@wsj.com
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