NEW YORK (AdAge.com) -- With bids to buy Spanish-language media giant Univision Communications due June 20, the front-runner -- a group led by Mexico's Grupo Televisa -- was strengthened by the addition of Venezuelan media company Venevision, a Univision shareholder and program supplier, late last week.
Grupo Televisa and Partners Favored to Win Univision Auction

World's biggest
The group formed by Grupo Televisa, the world's biggest
Spanish-language media group, is widely believed to have the best
chance of buying Univision if the partners meet Univision's
ambitious price expectations. The other major bidder is expected to
be a group of five private-equity investors and firms.
"We believe that this strengthens team Televisa's negotiating
position for Univision and likely weakens the position of other
bidders further," William Blair & Co. analysts said in a
statement last week.
No U.S. media groups expected to bid
When A. Jerrold Perenchio, who controls Univision's voting shares,
put the company up for sale in February, U.S. media groups
initially looked at Univision but none are expected to make a bid.
Televisa has the potential to make life difficult for other
bidders. The Mexican media company has an 11.4% stake in Univision,
supplies some of its highest-rated programming in a deal that runs
until 2017, and is also involved in litigation with Univision over
minor but longstanding grievances.
Univision is also expensive. The company is believed to be looking
for $40 a share, valuing Univision at more than $12 billion.
(Univision's share price closed at $35.75 June 16, up 1.3%). The
last big Hispanic media deal was NBC Universal's acquisition of No.
2 Spanish-language network Telemundo for $2.7 billion in 2001.
The Televisa group includes Venevision, which has a 14% stake in
Univision, and private equity firms Bain Capital Partners,
Blackstone Management Associates, Carlyle Investment Management,
Kohlberg Kravits Roberts & Co., and Bill Gates' private
investment firm, Cascade Investment.
Other bidder
The other investor group preparing a bid for Univision consists
of Texas Pacific Group, Providence Equity Partners, Madison
Dearborn Partners, Thomas H. Lee Partners and media investor Haim
Saban.
'No guarantees'
"It's an auction," said Julio Rumbaut, president of Rumbaut &
Co., a Hispanic media consulting firm. "There are no guarantees.
However, Televisa has the financial backing, the infrastructure to
maximize future Univision operations, and apparently the desire to
prevail."
Univision declined to comment.
Hispanic media growth continues to outpace the general market. TNS
Media Intelligence last week downgraded its forecast for U.S.
ad-spending growth in 2006 to 4.9%, from 5.4% in an earlier
forecast in January. But TNS predicts Spanish-language media will
grow by 12.9% this year. Univision controls about 70% of all
Spanish-language TV advertising, and is also the largest radio
broadcaster and has the largest online operation with
Univision.com.
The company's top executives are ready for a sale. Last month,
Univision's board of directors approved generous severance terms
for four of the company's top executives if they lose their jobs
following a change in control of the company. The four --
President-Chief Operating Officer Ray Rodriguez, Vice Chairman
Robert Cahill, Chief Financial Officer Andrew Hobson and Exec VP
Douglas Kranwinkle -- would be entitled to three times their annual
salaries and maximum bonuses, and vesting of their share
options.