Wade Davis’ new investment fund just became part owner of Univision in a deal expected to close late summer with the former Viacom executive as CEO. It’s a new chapter for both, and Davis on Tuesday described an abundance of commercial, strategic and audience opportunities.
“This is a platform that is unique and, from a business standpoint, more attractive than any other media business out there,” he told Deadline.
Univision’s audience of Spanish speakers is the nation’s fastest-growing demographi and has “incredible cultural relevance,” he said. (Listen to pundits on the presidential primaries and there’s doubt about that.) The company has large news and sports operations, live events and music. Its core: a massive library of Spanish-language programming from its partnership with Televisa of Mexico.
What it does not have much of: the latest, biggest trend in entertainment, a dedicated direct-to-consumer service. Asked about DTC, he said, “For sure, “there’s room and there’s no competition.”
At Viacom (now ViacomCBS), Davis helped integrate free streaming service Pluto TV, a very successful acquisition. “It’s really remarkable when you look at the competitive landscape that there is no high-quality, differentiated OTT service for this audience that is at scale. … It’s a huge opportunity that is completely open from a competitive standpoint.”
Univision announced Tuesday morning that Davis’ investment company ForgeLight along with another financial firm, Searchlight Capital Partners, acquired a majority 64% stake. Televisa retains its 36% stake. A closer relationship with the giant content producer was essential, Davis said; the flow of telenovelas and sports programming is only assured as long as Televisa owns a stake. “If I did not believe that the opportunity existed to reset the relationship with Televisa, which in a way could be the most important strategic partner, I would not have undertaken the transaction.”
He emphasized that the programming deal “is perpetual until they decide to sell. And they could have decided to sell in this transaction. I view this as a fundamental reset.”
Financial terms of the deal weren’t released. But it did say that the Televisa programming deal would continue run for seven and half years in the event that Televisa sold its stake.
Another plus is that Univision has renewed 100% of its distributor agreement “for multiple years going forward,” he said. So no carriage battles.
He said management under Vince Sadusky, who replaced Randy Falco in mid-2018, has done a solid job positioning the company – including selling the Gizmodo (formerly Gawker) group of English-language websites that many felt were a distraction from the core business.
Davis said he put ForgeLight together at the end of 2019 as he transitioned away from Viacom. His thesis behind it is that there are companies out there he could both invest in and run well. “The ability to lead with an operational focus rather than a financial engineering focus is a huge opportunity,” he said.
Univision announced plans last summer to explore strategic options. It’s had a rocky road since going private after selling itself for $13.7 billion to a leveraged buyout consortium of private equity firms including Providence Equity Partners, Madison Dearborn Partners, Texas Pacific Group and Thomas H. Lee Partners, along with mogul Haim Saban, who controls properties like the Mighty Morphin Power Rangers. Those were today’s sellers. They had initially planned to cash out in an initial public offering but that never happened.
For Davis, “An IPO is not really a goal. The goal is to take advantage of the huge opportunities … an IPO is an afterthought.”
Davis joined Viacom in 2005 and headed mergers and acquisitions and strategy and corporate development before being named CFO in 2012. Previously he was an investment banker in the tech and media sectors at ThinkEquity Partners, Lazard Frères and Wasserstein Perella.
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