MIAMI — Telemundo Group Inc. and Reuters Television Ltd. said Tuesday they had reached an agreement to create a Spanish-language television news network along with three other media companies.
The 24-hour service, named TeleNoticias, will be transmitted via satellite to cable and broadcast outlets in Latin America, Spain and the United States. Reuters and Telemundo will hold a majority stake in the new venture.
Other partnership interests will be held by Artear S.A. of Argentina, Antena 3-Intl. of Spain, and Productora y Comercializadora de Television S.A. de C.V. of Mexico.
The companies said the agreement in principle is subject to the approval of a U.S. bankruptcy court overseeing Telemundo’s current bankruptcy proceeding.
Joaquin Blaya, president of Telemundo, said he expected the TeleNoticias cable news network to begin operation in the second quarter.
In biz by summer
He declined to estimate initial viewership of the network.
“There are 3.5 million homes with cable in Latin America. We have indications that we have high penetration in them,” Blaya told reporters at a news conference to announce the project.
He also said negotiations were under way to add a Brazilian partner to the project, saying a final agreement with the unidentified company could be announced as early as February.
Blaya and Reuters executives said the Spanish-language network was valued at about $ 100 million but declined to identify how much each of the five partners had invested.
The British Broadcasting Corp., which had said it planned to participate in the venture, dropped out.
Telemundo made a “substantial” contribution, Blaya said, and each partner contributed cash as well as in-kind services and equipment.
Telemundo and Reuters will have the biggest stake, together controlling more than 51% of the new business, he said.
TeleNoticias will face stiff competition from several other players in the fast-growing Spanish-language news field. General Electric Co.’s Canal de Noticias NBC is attempting a similar Spanish-language news service, as is the Mexican network Eco.
Turner Broadcasting’s Cable News Network also broadcasts about two hours of Spanish-language news daily.
Enrique Jara, a Reuters executive who will become chairman of TeleNoticias, said the new venture will have a competitive advantage as it is Spanish-language news produced by Spanish- speaking journalists, who work around the world 24 hours a day.
“Eco is a Mexican product with a Mexican point of view,” Jara said. “Canal de Noticias is a translation of English-language news. We will have greater credibility in the Spanish-language market.”