La Jornada: S&P: Televisa requires reducing leverage levels

Televisa requires reducing the equivalent of twice its leverage level in a period of one to two years to prevent Standard and Poor’s (S&P) from lowering its credit risk rating, the financial institution reported.

“In addition, we could lower the rating if Televisa’s liquidity position deteriorates, or if we determine that its participation in the investment in Televisa Univision cannot be monetized, or does not use the proceeds of a monetization to pay the debt,” S&P highlighted.

This performance would indicate that Televisa’s liquidity, or capital structure, no longer represents a strength for its credit quality, he highlighted. The rating agency said expectations are based on an organic scenario with no mergers or acquisitions in the next 12 to 24 months.

“If any opportunity in this regard materializes for Televisa to participate in a consolidation of the Mexican telecommunications market, we would have to evaluate its potential impact from a business, financial and liquidity perspective, to reflect any strengthening or weakening in its credit profile.”

Fewer subscribers

On May 8, S&P lowered Televisa’s issuer credit rating and its debt notes, due to a deterioration in its business risk profile, a decrease in its subscriber base, and a reduction in market share.