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Fresh from Chapter 11, Telemundo Group, the nation's second largest Spanish-language network now faces the challenge of programming against No. 1-Univision.

The U.S. Bankruptcy Court for the Southern District of New York last July approved a plan reducing Telemundo's outstanding debt to $117 million from $300 million. Telemundo filed for protection under Chapter 11 of the bankruptcy code in July 1993 and emerged from reorganization Dec. 30.

While the change in leadership is not expected to lead to management changes, President-CEO Joaquin Blaya, who joined the company from Univision in May 1992, is looking to improve the company's performance.

"Without a doubt, 1995 is critical," said Mr. Blaya. "We've got to turn our ratings around to pick up share to grow the business."

For November, Telemundo had a 25% share of Spanish-language TV household viewing, compared with 75% for Univision.

Mr. Blaya previously tried to differentiate Telemundo with U.S.-produced programming aimed at Hispanics. Now he's returning to the proven Spanish TV formulas-Mexican novellas (soap operas) and movies-and expects Telemundo's financial standing to be bolstered by co-production agreements.

Telemundo has signed an agreement with MultiVision of Mexico for 52 made-for-TV movies beginning early this year. It is also working with TV Azteca, the No. 2 TV network in Mexico, to co-produce dramas, scheduled for a June debut.

In December, Telemundo-with Reuters, the British Broadcasting Corp. and others-launched TeleNoticias, a 24-hour satellite Spanish-language news channel in the U.S., Mexico, Latin America and Spain.

At least one media buyer applauded Telemundo's back-to-basics approach.

"Telemundo needs to take a very good look at what the Nielsen [ratings] numbers are telling them. They need to get in touch with the predominantly Mexican marketplace and the shows and formats that generate the numbers," said Monica Fragale Gadsby, VP-associate media director at Leo Burnett Co.'s Hispanic unit.

Others are skeptical. George Ortiz, VP-media director at Castor Advertising, New York, said, "If Telemundo is nothing more than a mirror-image of Univision, it is never going to expand."

Telemundo had revenues of $131.8 million for the nine months ended Sept. 30, up 5% from the previous year. But as revenues slid 10% to $39 million in the third quarter due to the ratings slide, it posted a net loss of $5 million for the nine-month period.

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