In a move aimed at consolidating Mexico’s fragmented radio industry and boost advertising revenues, the country’s largest media group Televisa is in negotiations to acquire Grupo Radio Centro, the largest radio broadcaster. Although talks have been in train for over a month, it was only last Friday that news of the potential deal percolated to the outside world.
Publicly-owned Radio Centro boasts twelve radio stations in Mexico, and controls about a third of the market in Mexico City, the largest in the country. But internecine feuds within the controlling Aguirre family have led to a sag in the company’s share value and, in 1998, Chancellor Media of the US pulled out of an agreement to buy 50% of the company.
Conclusion of a successful deal would give Televisa a dominant nationwide radio presence, thereby boosting its leverage with advertisers. It already owns Mexico’s number three radio station, Radiopolis, and controls almost 80% of Mexico's television market. However, any deal must first be approved by the nation’s competition authorities – and is likely to encounter stiff opposition given Televisa's domestic dominance.
The value of the potential deal was not clear. And neither Televisa nor Radio Centro's chief executive Carlos Aguirre were prepared to comment.
Sourced from: Financial Times 8/5