A Mexican Media Giant Wants ‘R’ Texas Stations

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RBR+TVBR INFOCUS


In February 2017, a husband and wife who are not U.S. citizens but have been living in Alaska since 2006 became the first foreigners to obtain FCC approval for 100% ownership of an AM or FM radio station.

Then came the Commission’s August 2018 OK for a citizen of the United Kingdom and his Polish wife living in the U.S. since 2015 on E-2 investor visas to become the new owners of an Upstate New York radio station left for dead by its financially strapped seller.

Now, one of the most significant foreign ownership petitions to arrive at the FCC could see a Mexican multimedia giant gain full control of four stations once a part of Border Media Partners’ 33-station stable and for the past seven years have been owned by the company doing business as R Communications.

Twin Form 314 filings made with the Commission on Wednesday (4/17) show that R Communications, led by CEO Carlos Rodriguez, wishes to sell the following stations to a Houston-based entity using the licensee name Leading Media Group Corp.:

  • Top 40 KNEX-FM 106.1 & KBDR-FM1 in Laredo, Tex.; and regional Mexican KBDR-FM 100.5 “La Ley” in Mirando City, Tex.
  • Tejano KBUC-FM 102.1 in Raymondville, Tex.
  • News/Talk KURV-AM 710 in Edinburg, Tex.

The street address for this Houston-based operation happens to be that for a Spanish-language television station serving Hispanic consumers under the Multimedios brand.

This explains who is behind Leading Media Group Corp., and a plan that requires a filing with the Media Bureau of a Petition for Declaratory Ruling under Section 310(b)(4) of the Communications Act of 1934, as amended. LMG seeks a Declaratory Ruling permitting it to exceed the 25% foreign ownership benchmark.

In fact, LMG wants its ultimate parent entity, Monterrey, Nuevo León-based Grupo Multimedios Estrellas de Oro S.A. de C.V. granted FCC consent to hold 100% indirect ownership of LMG.

While LMG is a U.S. corporation organized under Delaware state laws, Multimedios is an 85-year old giant led by Francisco Antonio González Sánchez. It not only operates the Multimedios TV network, but also owns radio stations with such brands as Latin Pop AC “Hits,” Traditional Mexican AC “La Lupe,” and contemporary regional Mexican “La Caliente.” Furthermore, the company enjoys a national imprint from highly regarded newspaper Milenio and “offers billboard advertising, real estate, restaurants, sports, entertainment
centers, and public telecommunications networks businesses.”

Outside of Mexico, Grupo Multimedios also owns popular San Jose, Costa Rica-based radio stations Bésame and the license for Grupo PRISA Iberoamerican brand Los 40; and Madrid-based Top Radio, originally known as Top 40 Radio Madrid.

Multimedios’ cable TV arm was sold to Grupo Televisa to become Izzi; MMCinemas, its former movie theater group, is now part of the Cinemex family.

Now, thanks to the FCC’s 2016 Foreign Ownership Order, Multimedios is poised to cross the border into the U.S., legally.

“Multimedios’ ownership will permit LMG to serve the public interest in South Texas by bringing to the stations its extensive broadcast experience and expertise and an
influx of resources for technological upgrades and improved programming to stations
located in resource-scarce and minority-populated Texas communities,” the petition states.

Multimedios Treasurer Hugo Ismael Chapa Gamboa will serve as LMG’s President.

For Rodriguez, R Communications will be coming to an end; shareholders in R include Robert Reed, Roberto Gonzalez and veteran radio industry owner and executive Jay Meyers.

Representing Multimedios in Washington is Thompson Hine LLP attorney Barry Friedman. Serving as R’s legal counsel are Jessica Rosenthal and Gregory Masters of Wiley Rein LLP.

The KBDR transmitter is on a tower owned by American Towers. The KNEX transmitter is on a tower owned by Gray Television.

KURV & KBUC use a tower owned by R through MBM Texas Valley LLC.

MULTIMILLION ENTRY FOR MULTIMEDIOS

R Communications is selling the two Laredo and two McAllen-Brownsville properties for $6 million.

A $600,000 earnest money deposit has been delivered by Multimedios affiliate Texas Multi Tele Ventas to Wilmington Trust, serving as escrow agent. A post-closing escrow agreement increases this to $730,000.

Multimedios’ deal sees it acquiring $750,000 of the working capital of the four stations.

There is no broker or finder for these stations, which found themselves under a much different fate a decade ago.

In late July 2009, a group of radio stations in five Texas markets were transferred to a trust led by Patrick Communications founder Larry Patrick. These stations were the assets of Border Media Partners, a company founded in 2003 by Tom Castro and ultimately led by Jeff Hinson. However, Border failed to make debt payments following Hinson’s June 2017 appointment as President/CEO of the company and the stations were seized by Goldman Sachs and Vestar Capital Partners.

Fast-forward to February 2012, and Patrick had a buyer for three of these stations — Gonzalez’s MBM Revolution. For $2.7 million, licensee MBM Radio Laredo LLC agreed to purchase KLNT-AM, KNEX-FM & KBDR-FM in the Laredo, Tex., market. In May 2012, MBM went to Patrick and acquired six more stations for $2.5 million. This deal included KBUC-FM and KURV-AM. These stations are licensed to MBM Texas Valley LLC.

A MEXICAN TRANSFER FOR R

While the FCC will determine whether or not R can spin its U.S.-licensed stations to an entity ultimately controlled by Multimedios, three stations serving the McAllen-Brownsville-Harlingen market operated by R through a Mexican licensee are being spun.

These Mexican stations are:

  • XHRR-FM 102.5 “La Ley” in Reynosa, Tamaulipas
  • XHCAO-FM 89.1 “La Lupe” in Ciudad Camargo, Tamaulipas
  • XHAVO-FM “Digital 101.5,” Rio Bravo, Tamaulipas

R operates these stations under heritage licensee names Radio BMP de Ciudad Camargo,
S.A. de C.V. and Radio BMP de Reynosa, S.A. de C.V., reflecting the former Border Media Partners.

The company getting these properties is Radio Ultra S.A. de CV, operator of Spanish Contemporary “Ultra Radio”; ranchera-intensive “Radio Ranchito”; and News/Talk “Ultra Noticias.”