Why Did Univision Just Exit El Paso?


By Adam R Jacobson

In a surprising move, Univision Communications has agreed to sell its three stations in El Paso, Texas to an entity that serves as a U.S.-based extension of a Mexican media giant.

Does this point to more divestment from Univision, which swung to a net loss in Q3 as total revenue slid?

Don’t count on it, insiders tell RBR + TVBR.

A Univision spokesperson tells RBR + TVBR that the sale “will allow us to reinvest and continue to optimize our operations to best inform, empower and entertain our community.” The spokesperson would not comment on whether this sale was unique to market conditions in El Paso, or the start of additional market divestment.

In an asset purchase agreement filed with the FCC on Thursday, Univision is selling KAMA-AM 750, KQBU-AM 920 & KBNA-FM 97.5 “Qué Buena” to 97.5 Holdings LLC for $2 million.

A Texas LLC, 97.5 Holdings LLC is 25% owned by Grupo Radio Centro, and concurrent to the sale is an LMA agreement between GRC and Univision allowing the Mexico-based company to assume control of the trio.

With the sale of the three stations to GRC, Univision is also selling the property at the KAMA transmitter site to Del Norte Real Estate Texas. 

KQBU is a Class B with 1kw daytime from 1 tower and 360 watts at night from 3 towers. It is a simulcast partner of Class C 100kw blowtorch KBNA, the top-rated regional Mexican station in El Paso. It’s a highly competitive market, and a challenging one for Spanish-language broadcasters given the abundance of Mexico-based signals from across the Rio Grande, in Juarez, Chihuahua.

KAMA, an affiliate of the Spanish-language News/Talk “Univision America” network, is a directional Class B facility with 10kw day from two towers, and 1kw night from four towers. This is done to protect 50kw Class A WSB-AM in Atlanta.

KBNA will likely retain its format, although hosts and branding may evolve under GRC ownership.

It’s a different matter for KQBU and KAMA, as one of the stations is expected to adopt GRC’s “Radio RED” News/Talk presentation found at stations in Mexico City, Guadalajara and Monterrey. The other could take on GRC’s “Formato 21” or “Radio Centro” brands, which also focus on news and spoken-word programming.

With the purchase of U.S.-based radio stations, it is not known if GRC intends to focus its efforts on Chihuhahua-based listeners, or desires to reach Hispanics on both side of the Rio Grande.

GRC owns 12 stations in Mexico City, along with the Radio RED stations outside of D.F.

The deal, if approved by the FCC, is similar to the August 2012 sale between Emmis and “93.9 Holdings Inc.,” of which GRC holds 25% ownership interest as it is a foreign entity and at present is prohibited from increasing its ownership interest without a FCC waiver.

While Univision enjoys a cozy relationship with Entravision Communications, they were an unlikely suitor given U.S. ownership regulations. Entravision already has three FMs and two AMs in El Paso, the nation’s 76th-largest market.

As of today, 97.5 Holdings LLC has paid a $250,000 escrow deposit to Univision, with closing expect after March 30, 2017.

There was no broker involved in this sale.

While the sale of the El Paso cluster begs the question of whether or not Univision Radio is starting a sell-off of underperforming radio assets, a source close to the matter says that is not the case.

“This is not the start of a sell-off. This deal allow Univision to reinvest in its assets,” the source said.

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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.