NEW YORK — Final bids for Spanish-lingo broadcaster Telemundo Group are due today, sources said Friday, with the bidders expected to include News Corp., a joint venture of Sony Corp. and Tele-Communications Inc., the NBC and Hicks Muse Tate & Furst partnership and King World Prods.
Telemundo meanwhile, said Friday it lost $3.3 million in the third quarter ended Sept. 30, compared with a profit of $1.4 million a year earlier, on 5% lower revenue of $48.6 million.
Telemundo, which owns eight full-powered TV stations in several major U.S. markets, has lost significant market share in recent years to its main rival Univision. Telemundo stock Friday closed down 12¢ at $34.50.
The red ink resulted from Telemundo’s loss of audience, although Telemundo CEO Roland Hernandez said, “Counterprogramming initiatives implemented in the late summer have already shown increased ratings in all of our major television markets.”
Univision has a big programming advantage over Telemundo because Univision has long-term rights to Spanish-lingo programming in the U.S. produced by Grupo Televisa. Looking to improve its situation, Telemundo disclosed in July that it had retained investment bank Lazard Freres to help it find a strategic partner that could help with programming.
Interest in the company has been intense (Daily Variety, Oct. 10) although it is not clear if Telemundo’s major shareholders — which include Apollo Partners — will sell outright or just bring in a minority investor to provide programming. Outright sale would cost close to $600 million, Wall Streeters estimate.
Telemundo said in a statement Friday it had engaged in “substantive discussions regarding strategic transactions” with several “entertainment concerns.” It added that it hoped to announce a deal shortly.
News Corp. and Sony/TCI are believed to be among the most avid bidders. News Corp. already has Latin America satellite interests, so it could use programming developed for those channels on Telemundo stations in the U.S.
Sony meanwhile, has the Sony Entertainment Television Latin American cable channel, so it could use programming aired on that cable channel on Telemundo.
But foreign ownership restrictions mean that Sony needs a U.S. partner, and TCI is keen to expand its Latin America programming reach. TCI Intl. execs said on a Wall Street analyst conference call Friday that it wanted to use $100 million raised from selling its Argentina cable systems interests recently on Latin America programming.
Other companies thought to have looked at Telemundo include CBS, which acquired Latin America news service TeleNoticias last year and as part of the deal it agreed to program Telemundo’s nightly newscasts for five years.
CBS had planned to launch a U.S. cable version of the news service, but that has yet to get off the ground, and an investment in Telemundo could help fulfill that objective. People close to the Eye web downplay its interest, however. CBS declined to comment.
Sources said Friday that Mexican broadcaster TV Azteca, which has a production deal with Telemundo, also is eyeing the company but needs a U.S. partner. There were rumors that CBS and Azteca may have teamed, but this could not be confirmed.
Additionally, Hicks Muse is said to be looking at the deal in partnership with NBC. Hicks Muse and NBC formed a joint venture to operate NBC affiliate KXAS Dallas and a San Diego NBC affiliate, after Hicks Muse acquired Lin Television Corp.