Less than a week after getting the green light from the FCC, the sale of Univision Communications to private investment firm Searchlight Capital Partners has crossed the finish line. As part of the complex transaction, former Viacom executive and ForgeLight principal Wade Davis has taken over as Univision CEO, replacing Vince Sadusky. The sale marks the end of a long process that earlier led the company’s previous owners to consider an IPO before finding a buyer.
The complex sale was structured as a stock purchase under which Searchlight bought the equity stakes held by a consortium of private equity firms since 2007. Searchlight now holds a 26.2% stake in the company with another 26.1% held by ForgeLight, the operating and investment firm controlled by Davis. Another 11.6% stake is held by Liberty Global, with the remaining 36.1% controlled by Televisa – the Mexican broadcaster that creates much of the content aired on Univision’s Spanish-language television network. Televisa keeps its program license agreement and will “continue to serve as an important strategic partner to the company’s new majority owners,” Univision said Tuesday.
The new owners said they plan to use Univision’s extensive platform and entertainment, sports and news content to “deepen its relationship with the Hispanic community” while looking for new growth opportunities by creating new content for the next generation of Hispanic viewers, expanding its portfolio of ad products and enhancing its digital presence.
Calling it a new era for the Hispanic media giant, Davis said the combination of Televisia's content with Searchlight’s investment experience will help it fully realize Univision’s potential as the leading Hispanic content company in the United States.
“Univision’s recognized and trusted brand, its consistent performance, and its leadership serving an important and growing consumer audience give us an unmatched opportunity to achieve even greater success,” said Davis. “This is a pivotal moment in Univision’s rich history, as the company plays an increasingly important role in educating audiences about key issues relevant to the Hispanic community and encouraging and elevating the dialogue on social justice and equality, while also continuing to provide entertainment when viewers need it most.”
No Radio Spinoffs Needed
To win FCC approval, the buyers have committed to the FCC to sell WLII-DT, WSUR-DT and WOLE-DT in Puerto Rico in order to come into compliance with local TV ownership rules. Univision already controls top-rated WAPA-TV and WSTE-DT in addition to two FMs and three AMs in Puerto Rico. The FCC concluded that in all 15 markets where Univision owns both radio and television assets, it is in compliance within ownership limits.
Univision had been exploring sale options since mid-2019 after an early attempt by its private equity owner – a consortium that includes Madison Dearborn Partners, Providence Equity Partners, TPG, Thomas H. Lee Partners and Saban Capital Group – was unable to find enough support on Wall Street to take the company public and allow them to begin liquidating their decade-old investment. The group paid $12.3 billion for Univision in 2007.
As part of the buyout, the FCC also granted the petition filed by Univision’s buyers to exceed the current 25% cap on foreign ownership. “We find that the public interest would not be served by rejecting Univision’s request to permit foreign investors to own up to 100% in the aggregate of Univision’s equity and voting interests,” its order said. The FCC previously gave Mexican broadcaster Televisa permission to hold up to a 49% stake in a 2017 ruling.
In a joint statement, Televisa co-CEOs Bernardo Gomez and Alfonso de Angoitia said the sale marks a “new phase” for Univision. “Wade’s leadership and Searchlight’s support are the catalysts that Univision needs to solidify its position as the leading Spanish-language media organization in the United States in light of the rapid changes that the industry is facing,” they said.