2 Min Read
MEXICO CITY, Aug 1 (Reuters) - Mexico's top broadcaster Televisa on Thursday said it paid 7 billion pesos ($545 million) in seeking to acquire a controlling stake in Mexican cable company Cablecom.
The deal, which is subject to regulatory approval, would give Televisa control over 51 percent of Cablecom with the option to purchase the remaining 49 percent, the company said in a statement.
Cablecom has 1.2 million cable, Internet and voice subscriptions, the company said. Televisa reported 4.68 million cable, Internet and voice subscriptions at the end of the second quarter. Televisa also has 5.6 million satellite TV subscribers.
The deal is not a straightforward acquisition. Televisa bought convertible debt in Tenedora Ares, the holding company behind Cablecom. That investment can convert into ownership of 95 percent of Ares stock.
As part of the deal, Televisa said it had also invested 2.5 billion pesos in Ares debt.
Cablecom expects to see revenues of 3.9 billion pesos in 2014 and projects earnings before interest, taxes, depreciation and amortization (EBITDA) at 1.6 billion pesos next year, Televisa said.
Ares will have the option to purchase the remaining stake of Cablecom at a price equal to 9.3 times EBITDA during the 12 months prior to exercising the option, the statement said.