Televisa, Univision to bury the hatchet?
By Cyntia Barrera Diaz
MEXICO CITY (Reuters) - A decision by Mexican broadcaster Televisa and U.S. partner Univision to delay a trial, the latest in a three-year legal battle, is good news, analysts say, and could lead to a settlement out of court.
Televisa, the world's biggest producer of Spanish-language shows, and Univision were to begin a trial in Los Angeles on Tuesday but they asked a judge to postpone it until July.
The two have been sparring in courts since 2005, when Televisa filed a lawsuit demanding royalty payments it said Univision had withheld as part of a programming deal that expires in 2017.
The companies declined to say why they waited until the last minute to ask for more time.
"I think this is good news for both parties ... the best scenario for them is that they continue with the agreement," said Gregorio Tomassi, an analyst with Santander.
Univision, which heavily depends on Televisa's programming for its prime time line-up at its three networks, would be hurt if the deal falls apart.
"It is not convenient for Univision to scratch the relationship with Televisa," said HSBC analyst Jaime Aguilera.
The legal fight began in 2005 after Jerrold Perenchio, then CEO of Univision, made one of his lieutenants his successor, crushing Televisa's hopes of putting one of its own at the helm of the U.S. company.
Things got worse the following year when Televisa lost a bid for Univision against a group of investors led by media tycoon Haim Saban. Televisa later sold its 11 percent stake in Univision.
Televisa's wants more money from Univision for airing its shows in the United States, where there is a large underserved Latino market that the Mexican media giant wants to tap.
Hispanics are the fastest-growing minority, accounting for about 14 percent of the United States' 300-million strong population.
"Univision did not start the dispute ... Televisa has always been the one who has tried to strike a (new) deal," said Vector analyst Martin Lara.
He said Televisa could try to buy part of Univision again or demand a stake in it in exchange for the renegotiation, or extension, of the programming deal with the U.S. broadcaster.
Televisa shares, up a marginal 1 percent this year compared with the broader market's gain of 2.5 percent, closed down 0.85 percent at 52.57 pesos on Tuesday. Its New York-traded shares slipped 0.71 percent to $25.04.
(Additional reporting by Tomas Sarmiento)
Reuters/Nielsen
