Moody's: Grupo Televisa outlook developing

Moody's Investors Service said it changed the outlook on Mexico-based Grupo Televisa SA de CV's Baa2 senior unsecured debt rating to developing from stable after the company announced that its board of directors is preparing a plan to increase its stake in Univision Communications Inc. from its current 11.4% level with warrants exercised.

The developing outlook reflects Moody's view that Televisa will most probably not only increase its minority stake but ultimately seek to control Univision, a move that, if attainable given regulatory constraints and the likelihood of a high valuation for Univision, would most probably involve higher debt levels, particularly if private equity investors are involved.

Televisa currently has a good balance sheet position in terms of leverage and liquidity, with total debt to EBITDA of 1.4x and $1.62 billion of cash on hand, which means that the company has the financial flexibility to do a transaction of moderate size, the agency said.

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