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Westinghouse Buys Into Latin Market

Broadcasting: Purchase of Telenoticias paves way for 24-hour Spanish news channel.

June 28, 1996|From Bloomberg Business News

MIAMI — Westinghouse Electric Corp. jumped into the fast-growing market for Spanish-language TV news with the purchase of Telenoticias from Miami-based Telemundo Group Inc.

The acquisition in one stroke makes Westinghouse, owner of CBS Inc., the world's second-largest all-news Spanish network and also paves the way for a 24-hour Spanish news channel in the U.S. later this year.

"This purchase improves our Latin American coverage overnight," said CBS News President Andrew Heyward. "And we believe we can improve Telenoticias."

Westinghouse, which has gone on a buying spree of broadcast companies recently, is attracted to the potential of the huge Latin market. Television ownership is exploding in Latin America while Spanish is spoken at about 27 million U.S. households.

The purchase price wasn't disclosed.

Telenoticias operates a 24-hour news channel that reaches 3 million homes in Latin America and Spain via cable and satellite service and another 11 million homes through regular broadcast TV.

Westinghouse won't be alone in seeking to capture the Latin market. Other heavyweights including the NBC, Rupert Murdoch's News Corp.; GM Hughes Electronics Corp.; and Turner Broadcasting System Inc.'s Cable News Network are starting regional news programming in Latin America.

In addition, Mexico's Grupo Televisa, the world's largest Spanish-language broadcasting and publishing company, has been seeking to expand to the Spanish-speaking population in the rest of the world, analysts said.

Bloomberg, parent of Bloomberg Business News, competes in the production of TV and radio news and information in Latin America and other markets.

Broadcasters, along with other multinational companies, have been attracted to the Latin American market in recent years by economic policies that have reduced inflation and put more money in the pockets of consumers. The number of households with cable TV in Spanish-speaking Latin America has increased to 9 million today from 5 million in 1993.

"Latin America is a rapidly growing, 400-million-person market," said Francisco de la Torre, president of Telenoticias. "Everyone is trying to enter the market."

Telenoticias also reaches 6 million Spanish-speaking homes in the U.S. with its two prime-time news programs. The programs are broadcast by Hialeah, Fla.-based Telemundo, the second-largest Spanish-language network in the U.S. behind Televisa's Univision subsidiary.

To complete the transaction, Telemundo first bought out its three partners in the venture--Reuters Holdings, Spain's Antena 3 de Radio and Argentina's Artear.

Telemundo sold the money-losing Telenoticias after disputes with its partners over programming and over who should run the company, de la Torre said. Reuters and Telemundo each had a 42% stake in the company, whereas Antena 3 and Artear each had 8%. Annual revenue for Telenoticias was not disclosed.

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