Univision files for IPO as Latino clout soars
Analysts: Firm could be valued at up to $ 20B
Univision, the largest Spanish- language broadcaster in the U. S., is going public at a time when Wall Street is salivating over the growing clout of Latino consumers.
The New York media company filed for an initial public offering with the Securities and Exchange Commission without disclosing the number of shares it would offer or the price range. Analysts say Univision could be valued at up to $ 20 billion in its market debut.
The IPO comes as the Spanish- speaking audience remains one of the nation’s fastest- growing demographics, and has proved to be an increasingly vital group for advertisers. A recent report by Spainbased nonprofit Instituto Cervantes said that the U. S. now has more Spanish speakers than any other country other than Mexico.
The Hispanic U. S. population is expected to reach 77 million by 2030 and account for more than a fifth of the nation’s population, up 35 percent from last year, according to a Univision regulatory filing released Thursday. The demographic represents $ 1.3 trillion in buying power, a number expected to grow 30 percent by 2019. The Hispanic market also skews younger, with 60 percent of it in the 34- and- under group favored by advertisers.
Univision, whose networks reach 49 million people each month, has long been expected to tap the public markets to help pay down a heavy debt load the company projects to be about $ 10 billion. The broadcaster in March assembled a team of investment bankers to handle the offering.
“They have been preparing for this,” said Carl Salas, a vice president and senior credit officer for Moody’s. “Timing isn’t a coincidence.”
Univision’s owners, including Los Angeles billionaire Haim Saban, have long been looking to cash out. Saban and his four privateequity partners bought the company for $ 13.7 billion 2007 in a highly leveraged deal that saddled the company with debt.
The owners — which also include Providence Equity Partners, Madison Dearborn Partners, Thomas H. Lee Partners and Texas Pacific Group — had wanted to sell the company outright to another media firm. But potential buyers, including Time Warner Inc. and CBS Corp., balked at the $ 20 billion price.
Univision had been expected to schedule the offering before the 2016 presidential election cycle gets into full swing. The race is expected to produce a bounty of campaign cash for Univision as politicians attempt to woo Latino voters.
Hispanics are a growing voting bloc, with roughly 10 percent of the total voter base this year. That’s up 14 percent from 2012, a growth rate far quicker than the general voting populace over the same period.
Univision “will benefit immensely from the inflow of record levels of political spending,” Moody’s Salas said. “The consumer spending and the capabilities of the Hispanic market in America is growing faster than the rest of America.”