Televisa Agrees to Sell Stake in Spanish Media Group

Mexican television broadcaster Grupo Televisa said it has agreed to sell its 19% stake in Spanish media group Imagina for $353.6 million (284 million euros), part of an overall effort to divest of what it deems non-core assets.

Telvisa said earlier this year that it would look to divest of non-strategic assets to focus more on content and distribution. In a statement the company said the Imagina deal was the first step in that initiative.

Televisa stock was up about 3% in early trading Friday. The sale of the stake to Orient Hontai Capital is part of a larger deal by the China-based conglomerate to acquire a majority interest in Imagina.

In a note to clients ISI Evercore media analysts Vijay Jayant and David Joyce wrote that at the announced sale price the stake is worth roughly eight times more than their sum-of-the-parts valuation.

“This had clearly been an overlooked asset in the Televisa portfolio,” the analysts wrote. They added that other assets that could find their way to the sale block include Televisa's publishing and publishing distribution operations, its gaming business (mainly bingo parlors and online lottery tickets), feature film distribution and radio operations.

“In aggregate, there could be at least $400 million in asset sales to come, or at least $0.40-$0.50/share in equity value,” the analysts wrote.

Televisa’s soccer business, which includes Mexican soccer team Club America and the stadium in which it plays, is expected to remain under the corporate roof, as company chairman Emilio Azcarraga Jean heads up that operation now after he stepped down as CEO of the television company last fall.