TV Azteca
From Wikipedia, the free encyclopedia
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| Type | Broadcast television network |
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| Country |  Mexico |
| Availability | National; also distributed in the United States and certain other North American countries |
| Founder | Ricardo Salinas Pliego |
| Owner | Television Azteca S.A. De C.V. |
| Key people | Mario San Román (CEO) |
| Launch date | 1993 |
| Past names | Imevisión |
| Website | www.tvazteca.com/ |
TV Azteca is the second largest Mexican television network. It was established in 1993, following the privatization, under President Carlos Salinas de Gortari, of the state-owned Instituto Mexicano de la Televisión ("Imevisión"). Its flagship program is the newscast Hechos.
In Mexico the network operates three stations: XHDF ("Azteca 13"), XHIMT ("Azteca 7") and XHTVM ("Proyecto 40"). All of these enjoy near national coverage. Azteca 13 can also be seen live online via TV Azteca's website.
The network also operates Azteca 13 Internacional, reaching 13 countries in Central and South America.
TV Azteca subsidiaries include Azteca América, the fastest-growing television network in the United States (co-owned with Pappas Telecasting); Todito.com, a web portal for North American Spanish speakers; and Unefon, a Mexican mobile telephony operator focused on the mass market.
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[edit] Privatization Process
On July 18, 1993, Mexico's Finance Ministry (Secretaría de Hacienda y Crédito Público or SHCP) announced that Radiotelevisora del Centro, a group controlled by Ricardo Salinas Pliego, was the winner of the auction process to acquire the "state-owned media package" that included Imevisión. The winning bid amounted to US$645 million.
Rival bidders included:
- Grupo Cosmovision, , which came in a distant second place with its US$495 million bid.
- Grupo Medcom, affiliated to Grupo Radio Red, controlled at the time by Clemente Serna Alvear, and came in third with its US$454 million bid.
[edit] Allegations of improprieties in the privatization process
Like many other of the Privatizations undertaken during the Salinas administration, the sale of "TV Azteca" has been mired by allegations and suspicions of impropriety.
On July 4, 1996, Ricardo Salinas Pliego made the stunning admission that approximately US$30 million out of the US$645 million purchase price paid to acquire TV Azteca during the Salinas de Gortari administration had in fact come from a "personal loan" granted to him on August 11, 1993 by Raul Salinas de Gortari, brother of former Mexican President Carlos Salinas de Gortari (the Salinas de Gortari brothers are not related to Mr. Salinas Pliego). This clearly gave rise to conflict of interest accusations and serious suspicions on the integrity of the Imevision Privatization Process. The money was transferred using a complicated scheme of intermediate steps which included offshore accounts, which only added to the suspicions. Mr. Salinas Pliego's revelations came only after Mexican and Swiss prosecutors accused Raul Salinas de Gortari of Money Laundering after the discovery of multi million dollar deposits in Swiss Bank Accounts by Raul Salinas de Gortari. The Money Laundering charges against Mr. Salinas de Gortari are still being litigated, while no charges were ever made in relation to these matters against Mr. Salinas Pliego or against TV Azteca.
[edit] Financial improprieties allegations
On 5 January 2005 the U.S. Securities and Exchange Commission (SEC) accused TV Azteca executives (including chairman Ricardo Salinas Pliego) of having personally profited from a multi-million-dollar debt fraud committed by TV Azteca and another company in which they held stock. The charges are among the first brought under the provisions of the Sarbanes-Oxley Act of 2002, introduced in the wake of the corporate financial scandals of that year.
On April 28, 2005 the Comisión Nacional Bancaria y de Valores [1] (CNBV), the Mexican Banking and Securities Commission, notified TV Azteca, Ricardo B. Salinas, Chairman of the Board, and Pedro Padilla L., Board Member of the Company concerning financial penalties being imposed in connection with administrative procedures that were brought by the CNBV in late January 2005 arising from alleged violations of the Mexican Securities Law as a result of transactions that occurred in 2003 among Unefon, Nortel and Codisco. The aggregated amount of the financial penalties equals approximately US$2.3 million, of which the CNBV intends to impose upon TV Azteca a penalty equivalent to approximately US$50,000.
April 30, 2005, Finance Secretary Francisco Gil Díaz asked prosecutors to bring criminal charges against TV Azteca Chairman Ricardo Salinas Pliego on allegations he used privileged information to trade shares, people familiar with the matter said.
Gil Díaz's fiscal prosecutor filed the 1,200-page request to charge Salinas Pliego, who controls the No. 2 broadcaster, with the Attorney General's Office (PGR) April 27, said the people, who asked not to be identified. Regulators yesterday separately fined Azteca, its chairman and board member Pedro Padilla US$2.3 million for securities law violations.
The proposed criminal charges go beyond a civil suit brought by the SEC on January 4 that accused Salinas Pliego and his company of securities fraud for hiding a transaction that netted him US$109 million.
Just a few days before the charges were formalized, TV Azteca dennounced a blackmail attempt by Gil Díaz to avoid the transmission of an investigation by Azteca's reporter Lilly Téllez of alleged corruption acts during the 1994 economic crisis in Mexico. According to TV Azteca, the charges made by Gil Díaz were in retaliation for the transmission of Téllez report. The rest of the media found the accusations incredibly weak and, given the timing, suspicious: their proof was an unsigned document printed on plain paper stating the terms of the blackmail, supposedly given to a TV Azteca representative by Gil Díaz himself in his own office.
The case will test the country's insider-trading legislation for the first time since the government toughened the law in 2001 to criminally prosecute violators.
"There's recognition worldwide that until securities law violators are prosecuted criminally, civil enforcement will have a limited deterrence effect," said Jacob Frenkel, a former U.S. federal prosecutor and SEC enforcement lawyer who is now a partner at Shulman Rogers in Rockville, Maryland.
- UNEFON
Salinas Pliego, 49, made a US$109 million profit in 2003 after buying debt that TV Azteca phone unit Unefon SA owed to Nortel Networks Corp. for a discounted price, and then receiving repayment from Unefon at full value three months later, the SEC said in January. The SEC alleged Mexico City-based TV Azteca, whose shares trade in both Mexico and the U.S., failed to tell shareholders about the transaction.
The SEC requires companies to disclose so-called relatedparty transactions because they may involve conflicts of interest.
Dan McCosh, a spokesman for Salinas Pliego and the companies he controls, declined to comment on the possibility of criminal charges. Salinas Pliego and TV Azteca denied any wrongdoing Thursday and said they would appeal the administrative fines imposed by regulators, according to a statement sent to the Mexican stock exchange.
In September, Salinas Pliego told reporters he wasn't concerned about the SEC investigation. "We are totally convinced we acted correctly, and we are going to defend ourselves," he said.
- DOWNGRADES
Mexican regulators started investigating Salinas Pliego and the companies he controls in December 2003, after TV Azteca's outside lawyers publicly expressed concern about the Unefon debt transaction.
Analysts from Merrill Lynch & Co. Inc., JPMorgan Chase & Co. and Deutsche Bank reduced their recommendations on TV Azteca stock on Jan. 8, 2004, after the company disclosed details of the Unefon transaction, sending the shares 11 % lower that day to 5.52 pesos. TV Azteca fell 2.8 % in trading today to 5.49 pesos, down 22.4 % this year. Its American Depositary receipts fell 13 cents, or 1.6 %, to US7.99.
Gil Díaz asked Congress last month to revise legislation to expand shareholder rights and facilitate company share listings to spur the stock market. The changes would add to amendments made in 2001 that defined the information controlling shareholders and companies must disclose to minority investors.
The bill that Gil Díaz is now proposing would replace Mexico's 30-year-old securities law and reduce by two-thirds, to 5 %, the amount of stock shareholders must own to bring lawsuits against company executives, among other provisions. He said the new law won't be as strict as U.S. legislation.
[edit] See also
- La Academia, one of TV Azteca's most popular programs
- List of programs broadcast by TV Azteca
- List of TV Azteca affiliates
- Televisa, rival network of TV Azteca
[edit] External links
- Official Site
- Investor Relations
- SEC accusation
- Denying of the Azteca 13 Internacional by Canadian Authorities
- SEC accuses Mexican firm of fraud (BBC)
- (Spanish) TV Azteca's legal accusation against Francisco Gil Díaz (PDF format)
| Grupo Salinas |
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Corporate Directors: Joaquín Arrangoiz | Francisco Borrego | Tristán Canales | Luis J. Echarte | Diego Foyo | Gustavo Guzmán | Alfredo Honsberg | Gustavo Lacroix | Martín Luna | Armando Melgar | Jorge Mendoza | Esteban Moctezuma | Ernesto Nava | Luis Niño de Rivera | Pedro Padilla | Tim Parsa | Ricardo Salinas Pliego | Carlos Septién | Mario San Román | Javier Sarro | Adrian Steckel | José Ignacio Suárez | Gustavo Vega |
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Assets: Afore Azteca | Azteca América | Banco Azteca | Grupo Elektra | Iusacell | Movil@ccess | Seguros Azteca | todito.com | Telecosmo | TV Azteca | Unefon |
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Annual Revenue: 3.7 billion USD FY 2005) | Employees: 34,000 | Website: www.gruposalinas.com |
