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Mergers, Acquisitions and Takeovers Case Study

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Case Title:

The Battle for Univision

Publication Year : 2006

Authors: Sweta Chhaochharia, Kumar Satyaki Ray

Industry: Entertainment

Region:US

Case Code: MAA0137K

Teaching Note: Not Available

Structured Assignment: Not Available

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Abstract:
Televisa, the Spanish-language media giant and Mexico’s biggest media company had made a bid for $13 billion or $36.25 a share for Univision Communication, the third largest Spanish language broadcaster. The Televisa group was backed by Venezuelan media investor Gustavos Cisneros, Bain Capital, Blackstone Group, Carlyle Group, Cascade Investment and Kohlberg Kravis Roberts. The other bidding group consisting Madison Dearborn Partners Inc., Providence equity Partners, Texas Pacific group, Thomas H. Lee Partners and billionaire Haim Saban’s Saban Capital Group had placed their bid of $12.3 billion or $35.5 a share. The deals were facing hurdles for price and governance issues as Univision was expecting bids worth more than $40 a share. Analysts had perceived some big potential regulatory hurdles for the bidders in dealing with the Federal Communications Commissions foreign ownership and overlapping asset restrictions. Analysts were divided in their opinion whether Univision would accept the offer or try to push the bids higher or decide against selling the company entirely. The case deals with the strategic reasons why different companies prefer to acquire Univision, the deal offer by various companies and bidding and counter bidding process to acquire Univision. This case also highlights the various synergies and problems associated with the Univision acquisition.

Pedagogical Objectives:

  • The Spanish broadcasting industry in America
  • To understand the business model and operation of Univision, the largest Spanish-language media company in the United States
  • To understand the business model and operation of the private equity companies, the Saban Capital, Madison Dearborn Partners, Providence Equity Partners, Texas Pacific Group, Thomas H. Lee Partners
  • To understand the business model and operation of the other bidding group, the Televisa
  • To discuss which one among the two biding groups would fit well with the Spanish media company Univision
  • To analyse the future prospects and perils arising out of the deal.

Keywords : Mergers,Acquisitions,Alliances Case Study;Televisa; Univision; Bain Capital; Kohlberg Kravis Roberts & Co; Cascade investments; Carlyle Group; Blackstone Group; TV Azteca; American Broadcasting Company (ABC); CATV (Community Antenna Television); Time Warner; News Corporation; Hispanic market; Madison Dearborn Partners Inc; Saban Capital

Contents: 
Televisa
Univision
Televisa: Univision- Not Stranger
Key Statistics and Ratios-Televisa
Business Description-Televisa
Income Statement-Univision
Business Description-Univision
Televisa-Univision : Legal Battle

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