Donald Trump's insulting remarks about Mexican immigrants have cost him a lucrative broadcasting deal, after Univision ended its relationship with the Miss Universe Organization.
The international beauty pageant part-owned by Mr Trump will have to find a new television home after the largest Spanish language broadcaster in the US quit the partnership.
The move is the first sign that Mr Trump's strident opinions could be affecting his business empire. Announcing his bid for the Republican presidential nomination last week, he said that Mexico was sending to the US "people that have lots of problems, and they are bringing those problems [to] us. They're bringing drugs; they're bringing crime; they're rapists; and some, I assume, are good people."
He said he would build a "great, great wall" on the Mexico-US border, adding that "the US has become a dumping ground for everybody else's problems". Mr Trump has since said he was "personally offended" by the "mainstream media's attempt to distort my comments".
Univision said it saw "first-hand the work ethic, love for family, strong religious values and the important role Mexican immigrants and Mexican-Americans have had and will continue to have in building the future of our country".
Mr Trump told Politico, the news website, that he had an "ironclad" five-year contract with Univision. "They have no termination rights whatsoever," he said. "They've defaulted on their contract because of pressure put on them by Mexico."
It is unclear how much Univision's contract with the Miss Universe Organization was worth, but ratings for the pageant recently hit a five-year high, with 7.6m total viewers.
Founded in 1952, Miss Universe is one of the world's longest-running beauty pageants. It was acquired in 1996 by Mr Trump, who now owns it with NBCUniversal, the Comcast-owned media group which now shares US broadcasting rights with Univision.
Univision's stance is emblematic of the rising purchasing power of the 55.4m-strong US Hispanic population. Although immigration from China now exceeds that from Mexico, Latinos represent the fastest growing demographic group in the US, which makes them increasingly attractive to advertisers.
©AFP Miss Universe 2012 finalists
Latinos' buying power will hit $ 1.5tn this year — a 50 per cent increase on 2010, Nielsen estimates.
With 16 broadcast, cable and digital networks and 129 local television and radio stations, Univision has a vast following among the country's Hispanic population: its Los Angeles station is regularly the most watched among adults aged 18-49 in day and primetime programming.
In 2007, Univision was acquired by a consortium of private equity investors in a highly leveraged deal worth more than $ 13bn including debt.
The company's owners — Saban Capital, Madison Dearborn Partners, Providence Equity Partners, Thomas H. Lee Partners and TPG Capital — recently appointed Goldman Sachs, Morgan Stanley and Deutsche Bank to lead an initial public offering that could value the company at more than $ 20bn including debt, according to people familiar with the matter.
The planned IPO is expected to raise more than $ 1bn. The consortium of owners would have preferred to exit their investment sooner — preliminary sales talks were held last year with several potential buyers, including Time Warner and CBS — but any potential deal was hamstrung by Univision's vast debt pile, estimated to be between $ 9bn and $ 10bn.
However, the company has "deleveraged at a very accelerated pace", according to one person involved in the deal. Total debt is expected to fall to about $ 6bn within three years, according to a confidential internal projection.
Copyright The Financial Times Limited 2015. You may share using our article tools.
Please don’t cut articles from FT.com and redistribute by email or post to the web.
No comments:
Post a Comment