Cisneros, U.S. Ibo firm to invest $500m in Latin media

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MEXICO CITY -- Venezuelan conglomerate the Cisneros Group and the U.S. leveraged buy-out firm of Hicks Muse Tate & Furst have formed a $500 million investment fund to invest in Latin American, Port- uguese and Spanish media.

Dallas-based Hicks Muse and Cisneros of Caracas will each put $250 million into Ibero-American Media Partners, LP, over the next three years, and will commit or raise additional capital for the fund if other opportunities arise.

The fund will be located in Miami and will focus on acquiring, investing in, and developing alliances with TV and radio broadcasters throughout Latin America, the Caribbean, Spain and Portugal. It also will pursue oppor- tunities in Spanish- and Portuguese- language production and programming firms, which could include U.S. outfits. The ultimate goal is to create a pan- Ibero American media network.

Any potential investment will be evaluated individually and must stand on its own, says Hicks Muse Managing Director Alan Menkes. However, "we do think opportunities exist to share programming, develop branding and sell advertising on a more regional basis."

He sees particular potential for con- solidation in the Latin American radio market. "Radio is still highly fragmented," he says.

The LBO firm of Hicks Muse has been spending aggressively to acquire media properties over the past few years. In August, it became the largest radio operator in the U.S., and more recently entered theater exhibition when it agreed to buy United Artists Theater Circuit for $850 million. It was rumored to have participated in the bidding for number two U.S. Spanish-language network Telemundo.

In addition to the investment capital, the partners are planning to contribute existing holdings to the new joint venture. "Those plans are in the process of being completed. We will probably be able to make an announcement next month," said Cisneros' senior vice president of corp- orate strategy, Beatrice Rangel.

The multi-billion dollar conglomerate has interests in various fields, includ- ing such media holdings as Venevision, the largest producer of Spanish-language programming in South America, a 25% holding in U.S. Spanish net Univision, and a major stake in Galaxy Latin America and its DTH service, DirecTV.

Copyright December 1997, Crain Communications Inc.

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