After years of jockeying, Spanish broadcaster Antena 3 and smaller web La Sexta announced board approval for a merger Wednesday.

Antena 3 will absorb La Sexta, which in return is guaranteed 7% of Antena 3 shares — a stake that may rise to 14% depending on the performance of the merged enterprise.

With Antena 3’s market cap of €966 million ($1.25 billion), the deal values La Sexta at up to $175 million. Reuters reports that Antena 3 will assume $130 million of La Sexta’s debt.

The timing is ripe, as Spain’s TV ad spend plunged 7.4% in the first half 2011 to $1.57 billion, weakening La Sexta’s vaule and making it more affordable in a buyout.

The same day, Mexico’s Televisa swapped a 41% stake in La Sexta for a 14.5% share in the web’s largest shareholder, Imagina, giving the latter near total control of La Sexta, facilitating the merger.

Imagina is a joint venture between Globomedia, Spain’s largest producer of TV fiction, and Mediapro, an integrated production services and sports rights brokering company in Spain.

The transaction will further collaboration between Televisa and Imagina on content production. Televisa said it will give it certain rights of refusal to acquire formats and audiovisual content, as well as transmissions rights for certain sporting events.

Televisa will have two positions on Imagina’s board.