Mexico's Televisa Sells Mobile Stake, Buys Cable Company

By Anthony Harrup 

MEXICO CITY--Mexican broadcast and media company Grupo Televisa said Thursday that it completed the sale of its 50% stake in mobile operator Grupo Iusacell and used part of the money to buy a regional cable company.

The sale of the Iusacell stake clears the way for U.S. telecom giant AT&T Inc. to close its acquisition of Iusacell, which last year it agreed to buy from Mexican businessman Ricardo Salinas Pliego for $2.5 billion including the assumption of debt.

Televisa earlier agreed to sell its half of Iusacell to Mr. Salinas for $717 million, and booked a $320 million loss on the sale.

Televisa said it used part of the money to buy Cablevision Red, a regional operator with around 650,000 subscriptions to cable TV, broadband and phone service.

Televisa paid three billion pesos ($204 million) for the cable company, and will assume around 7.2 billion pesos in debt and other liabilities.

Cablevision Red--which operates mostly in the states of Guanajuato, Jalisco, Aguascalientes, Querétaro, Tamaulipas and Colima--is expected to generate sales of two billion pesos this year, and earnings before interest, taxes, depreciation and amortization, a measure of cash flow, of one billion pesos.

Aside from being Mexico's dominant television broadcaster with around 70% of the free-to-air market, Televisa is the largest pay-TV provider through several cable units and satellite television service Sky Mexico.

Write to Anthony Harrup at [e-mail]

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