Resignations Spark New Problem for Mexico

11 May 2004

Two high profile resignations have embarrassed Ricardo Salinas Pliego, chairman of Mexico's second biggest broadcaster TV Azteca.

James Jones, former US ambassador to Mexico and Gene Jankowski, former chairman of the CBS Broadcast Group, have resigned as independent directors.

Their departures come at a sensitive time. The US Securities and Exchange Commission and the Mexican authorities are investigating Salinas over a business deal involving two of his own companies.

The inquiry centres on how Salinas secretly used TV Azteca to finance his mobile phone company Unefon after he was unable to find backers for the venture.

Salinas, a controversial and high profile figure, controls a business empire that includes national retail chain, Elektra, Unefon and TV Azteca.

He bought the former state broadcaster more than a decade ago and subsequently transformed the ailing network into a profitable operation which is a strong competitor to leading broadcaster Televisa.

Salinas denies he broke any securities laws by not disclosing the deal. The SEC is involved because Azteca is listed on the New York Stock Exchange.

Data sourced from: New York Times; additional content by WARC staff