Properties merged to create AM, cut costs, up ad sales

BUENOS AIRES — Media companies continue to look for new ways of making ends meet in economically ravaged Argentina — and the latest example of their creativity is America Multimedios, which aims to challenge the major broadcasters.

AM was born Aug. 23 when Avila Inversora and Grupo Uno merged several properties in an all-stock deal in a bid to cut costs and increase ad sales.

Grupo Uno has brought to the venture three provincial TV stations — Canal 6 (San Rafael, Mendoza), Canal 7 (Mendoza) and Canal 8 (San Juan) — and weekly news magazine La Primera.

Avila is contributing 83% stakes in national third-ranked broadcaster America TV station Canal 10 (Junin, Buenos Aires province) and news feevee Cablevision Noticias (CVN) as well as its 20% share of financial newspaper Ambito Financiero.

Carlos Avila, head of Avila Inversora, will become prexy of AM, with Grupo Uno’s Daniel Vila as vice president and Avila’s son Juan Cruz general manager.

AM plans to weave in more assets, including newspapers, electronic media and radio stations, Avila says. “Our aspiration is to have a national media group,” he says. “We want to keep growing, and time will dictate how.”

Eyeing rivals

That will help it compete with Grupo Clarin and Telefonica’s Admira, the country’s biggest media groups.

AM also has a rival in Daniel Hadad. The journalist and lawyer recently bought No. 4 broadcaster Canal 9 (formerly Azul Television) with two partners. He also has interests in a financial paper, a TV production outfit and two radio stations.

Execs hope the merger will reduce costs in the face of Argentina’s worst economic crisis in years. The reconfigured group will have greater bargaining power over buying content and also will find it easier to recoup production costs, analysts say.

One idea is to repackage the shows produced for America TV to air on the other unaffiliated stations in the group. Another aim is to boost ad sales by selling packages that spread across the properties.

Many advertisers like cross-platform media deals as they come at an overall lower cost than purchasing separately, plus they provide benefits and bonuses like better placement, show sponsorship and product placement, says Diego Abadie, client services manager of Havas’ Media Planning Argentina, a media-buying firm.

America Multimedios’ expansion, however, will be slow at first while it tends to financial problems. America TV entered bankruptcy protection in October 2001, unable to make payments on about $17.4 million of debt.

Grupo Uno, meanwhile, is wading through money troubles at No. 3 cable operator Supercanal and provincial newspaper La Capital, which it continues to own outside the new group.

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