Univision Searchlight Lands On Wade Davis, Successor To Sadusky

By Adam Jacobson – February 25, 2020

Vince Sadusky, who will be relieved of his duties as CEO of Univision Communications
RBR+TVBR INFOCUS

For months, there’s been chatter of a sale of Univision Communications, with various unconfirmed reports across multiple news organizations. RBR+TVBR first alerted readers to these reports in December.

In the early morning hours of Tuesday, Feb. 25, the rumors became reality: The 64% ownership in Univision not held by Mexico’s Grupo Televisa has been snagged by a pair of investment firms in an arrangement that will see the exit of CEO Vince Sadusky.

Of the three parties said to be bidders for Univision by The Wall Street Journal some eight weeks ago, one has emerged victorious. That would the offer put forward by Wade Davis, a former Viacom CFO. Davis’ bid was perhaps the most intriguing, as Davis would unseat Sadusky as Univision’s chief executive.

It turns out that this was the offer Univision’s majority owners opted for, in a move that finally frees them of what turned out to be a disappointing debt- laden investment made just as the great recession of the late 2000s reared its ugly head on Wall Street.

As outlined in a press release distributed just after 7am Eastern, a definitive agreement was reached that sees private investment firm SearchLight Capital Partners and ForgeLight, an operating and investment company focused on media and consumer technology, snag the shares in Univision presently held by Madison Dearborn Partners, Providence Equity Partners, TPG, Thomas H. Lee Partners and Saban Capital Group, the latter of which is controlled by Haim Saban.

Financial terms were not disclosed.

Saban Capital Group, Providence Equity Partners, Madison Dearborn Partners, TPG and Thomas H. Lee Partners in 2007 took Univision private in a deal with a total value of $13.7 billion.

Grupo Televisa is retaining its 36% stake in Univision. Its valuable program
 licensing agreement will remain in effect and not expire — at least for now. Should Televisa voluntarily sell down “a substantial portion” of its ownership stake, the agreement would remain in place for an additional 7.5 years.

That’s essential for Univision, which remains heavily reliant on its Mexican partner for much of its programming — in particular in the sports arena, as its TUDN brand, formerly known as Univision Deportes, is a partnership build on the strength and presence in Mexico of Televisa.

That’s just one arena in which the Televisa-Univision partnership is vitally important for Univision Communications. “The agreement, which is one of Univision’s most strategic assets, provides the company exclusive access to the largest Spanish-language video library in the world,” Univision noted in the Tuesday morning release.

With Univision Communications presenting its Q4 2019 earnings on Thursday morning, the event could prove to be a farewell call for Sadusky, whose tenure at Univision has included a lengthy retransmission consent dispute with DISH Network.

El Último Adiós

The departure of Sadusky as CEO comes less than two years after he took command of the Doral, Fla.-based company.

In October, it wasn’t necessary expected. That’s when Bloomberg offered a report suggesting that “blank check company” Churchill Capital Corp. II, a special-purpose acquisition company (SPAC) formed by “serial dealmaker” Michael Klein, was considering a bid for Univision.

It was the first spark in a series of reports offered in response to a July 3, 2019 Univision statement confirming that its Board of Directors was reviewing strategic options and that Univision engaged financial advisors Morgan Stanley & Co. LLC, Moelis & Company LLC and LionTree LLC to assist with the process.

Then came a Dec. 19, 2019, report in The Wall Street Journal that claimed WAPA América and Spanish-language pay TV player Hemisphere Media Group — led by President/CEO Alan Sokol — was one of three bidders for Univision.

While Hemipshere and Univision representatives declined to comment on the report when reached by RBR+TVBR, multiple Hispanic market veterans pointed to Hemisphere’s deep pockets when asked about the plausibility of such a report. Further, Sadusky at the time of his joining Univision was a member of the Hemisphere Board of Directors, and had been on the Hemisphere board since January 2013.

That same WSJ report also claimed that private equity firm Platinum Equity was a Univision bidder. Billionaire Tom Gores in 1995 founded the private equity firm.

Then came the mention of the Wade Davis-led bid — the only one that specifically noted that Sadusky would be removed as chief executive.

That’s set to happen, pending regulatory approval of the SearchLight/ForgeLight investment. Closing is expected “later this year.”

Sadusky has been with Univision since mid-2018, when news of his selection to succeed the retiring Randy Falco first surfaced in a Bloomberg report.

Prior to his arrival at Univision, Sadusky was already well-known in the television industry for his roles both in Hispanic media and in the total market — namely as the CEO of Media General that successfully completed its merger with Nexstar Media Group.

Sadusky entered the Media General fold after serving as CEO of LIN Media, which merged with Media General in the final weeks of 2014. Sadusky spent a decade as LIN Media’s leader, joining the company in 2005.

From 1994-2004, he held the CFO role at Univision’s biggest rival — Telemundo.

Sadusky’s arrival followed the March 6, 2018 withdrawal of Univision’s Initial Public Offering after a series of delays.

Growth, Transformation and Telenovelas

“The combination of Searchlight’s experience as a long-term investor in the media and communications sectors, Davis’ experience managing the growth and transformation of large-scale media enterprises, and Televisa’s continued support as a leading producer of Spanish-language content, creates the opportunity for Univision to enter a new era of growth and innovation,” Univision noted in the Tuesday morning statement confirming the Searchlight/ForgeLight deal. “Together, the new ownership group intends to build on Univision’s recent content and programming momentum to accelerate growth, expand its portfolio of advertising products, substantially enhance its digital presence and continue to use best-in-class Televisa content.”

The statement also offered comments from Sadusky, who took pride in his efforts to turn around a company challenged on multiple fronts, from a botched entry into social media and blogs to the Uforia-branded radio division, where challenges are diminished nationally but remain in large markets including New York.

“We are a re-energized and refocused company, and today marks the start of an exciting new chapter with partners that recognize the excellent position Univision is in,” Sadusky said.

He thanked Univision employees “for their hard work and dedication,” adding that he was “so proud of everything we have accomplished that has led us to this great outcome.”

Sadusky continued, “Both Searchlight and Wade are wholly supportive of Univision’s core mission to entertain, inform and empower Hispanic America and fully embrace the commitment and special bond we have with our audience. Our talented operating team has transformed Univision to be strategically, operationally and financially stronger than it has been in years. We have made important moves—strengthened programming, secured many major distribution deals, closed our strongest Upfront in four years, divested non-core assets, and enhanced our news, sports, local and digital offerings. Our partnership with Televisa has never been stronger and continues to create an unstoppable, world-class content machine, as evidenced by Univision being one of only two broadcast groups to grow viewership this season. Our Latin Grammy Awards and Premio Lo Nuestro are the only major award shows on broadcast television delivering year-over-year audience growth, and just last week Premio Lo Nuestro beat every network in prime time.”

Commenting on his future, Sadusky added, “I remain committed to leading the company and supporting a smooth and successful transition over the coming months to ensure Univision is best positioned for the future ahead.”
 
About Author

Adam R Jacobson is a veteran radio industry journalist and advertising industry analyst with general, multicultural and Hispanic market expertise. From 1996 to 2006 he served as an editor at Radio & Records.

Courtesy of Radio + TV Business Reports