Televisa's Insatiable Appetite Sends Smaller Rival to Recordby
Megacable shares have catapulted 18 percent this year
Move involving the companies `likely in the near term': Itau
Megacable Holdings SAB is surging as its strong growth is making analysts bet a consolidation with Mexican pay-TV rival Grupo Televisa SAB could happen at any moment.
Megacable, one of the last independent cable operators in Mexico, rose 1.5 percent to 77 pesos at 1:45 p.m. in Mexico City, on track for the highest closing price on record and valuing the equity at $3.8 billion. The country’s telecommunications regulator completed an antitrust review of Televisa in March and gave that company the green light to continue an almost decade-long shopping spree for cable and satellite businesses, which has given it a 61 percent market share in Mexico.
An industry move involving Guadalajara-based Megacable and Televisa is “likely in the near term,” Itau BBA analyst Gregorio Tomassi said in a report last week. The two companies don’t have overlapping networks and could complement each other geographically, so there wouldn’t be significant regulatory hurdles, Credit Suisse said in a February report.
Megacable, the second-biggest cable operator with about 2.8 million video subscribers, is trading in line with its North American peers’ relative value, even as the shares have gained 18 percent this year through Wednesday. Proposals to make the industry more competitive have let Megacable round up new clients faster than the average of its peers with competitive prices for packages of TV, landline phone and Internet services.
Press officials at Televisa and Megacable didn’t respond to requests for comment.