Research Update: Univision Communications Inc. 'B' Ratings Placed On CreditWatch Positive On Televisa Media Assets Merger Plan

U.S.-based Spanish-language multimedia company Univision Communications Inc. has signed a definitive agreement to merge with Televisa's media assets. Univision will fund the merger with $2.1 billion of debt, $1.75 billion of preferred stock, and $750 million of common equity. We placed our 'B' issuer credit rating on Univision on CreditWatch with positive implications given the potential for leverage to decline below our 6.5x upgrade threshold, depending on the magnitude and timing of identified synergies and whether we consider the preferred stock as debt. Univision's S&P-adjusted gross leverage was 8.8x as of Dec. 31, 2020. At the same time, we placed our 'B' issue-level ratings on Univision's existing secured debt on CreditWatch with positive implications. This is because, depending on the

... Univision Communications Inc. has signed a definitive agreement to merge with Televisa's media assets. Univision will fund the merger with $2.1 billion of debt, $1.75 billion of preferred stock, and $750 million of common equity. - We placed our 'B' issuer credit rating on Univision on CreditWatch with positive implications given the potential for leverage to decline below our 6.5x upgrade threshold, depending on the magnitude and timing of identified synergies and whether we consider the preferred stock as debt. Univision's S&P-adjusted gross leverage was 8.8x as of Dec. 31, 2020. - At the same time, we placed our 'B' issue-level ratings on Univision's existing secured debt on CreditWatch with positive implications. This is because, depending on the resolution of our CreditWatch on the issuer credit rating, our estimated valuation of the new combined entity, and the terms of the proposed debt financing, we could potentially raise the existing...

Research Update