Hallmark Said Negotiating for L.A.’s Univision

Hallmark Cards is negotiating to buy Los Angeles-based Univision, the nation’s largest supplier of Spanish-language television programming, a source close to Univision said Tuesday. The source suggested that such a sale might bring as much as $330 million.

Officials at Kansas City, Mo.-based Hallmark and Univision--a branch of the Mexican-owned parent corporation, Univisa--declined Tuesday to confirm or deny the reports.

“We don’t say (the rumors) are false, we don’t say they are true,” Charles Hucker, Hallmark’s vice president of public affairs and communications said. “We do not and never have commented about speculation about acquisitions.” Hallmark recently concluded its acquisition of 10 Spanish-language stations--including KMEX-TV Channel 34 in Los Angeles--for $301 million.

Said Emma Carrasco, Univision’s director of corporate communications: “As far as we are concerned, it is rumor. . . . We don’t have anything more to comment on.”

But sources insisted Tuesday that a deal could be struck as early as Friday.

Rumors of an impending acquisition first surfaced two weeks ago, when the Mexico City daily El Heraldo de Mexico reported that Univisa Chairman Emilio Azcarraga Milmo had suggested that he was preparing to sell Univision. However, one source close to the purported sale claims that a $500-million price tag quoted by El Heraldo was too high.

The figure is closer to $330 million, the source said, with the bulk to come in the form of an 10-year agreement by Hallmark to pay $30 million a year for programming from Televisa, Mexico’s huge TV-programming empire and owner of Univisa.

Programming Price Cited

Hallmark has been offered first pick of programming produced by Televisa, which is already Univision’s main programming supplier, the source said. The rest of the purchase price, the source said, will go to buy Univision’s program production and advertising operations in Los Angeles and Laguna Niguel.

The sources said the purchase negotiations may have been triggered by Hallmark’s inability to strike a program purchasing agreement with Univision for KDTV-Channel 14, a Univision affiliate in San Francisco owned by Bahia de San Francisco Television Co., which Hallmark is currently attempting to acquire.

“The genesis of the deal was an inability to agree on what price Hallmark should pay Univision for its programming,” the source said. Hallmark is presently committed to an affiliation agreement for its other Spanish-language outlets which requires the firm to pay 37.5% of its net advertising revenue for Univision’s programming until mid-1989.

In contrast to Hallmark’s agreement with Univision, major networks such as ABC, NBC and CBS typically pay local stations between 15% and 17% of their commercial rate in exchange for the stations airing network programs and commercials.

Hallmark has reportedly been unhappy with this arrangement, the source said, and was therefore attempting to use the KDTV negotiations “as a precedent” for renegotiating its other affiliation agreements.

The sale of KDTV, KMEX and nine other Spanish-language stations was prompted by a bitter 10-year battle legal among station stockholders and an Federal Communications Commission refusal last year to renew their broadcasting licenses because the outlets were believed to be under the illegal control of Mexico’s Televisa.

In June, the FCC recently reversed an administrative law judge’s previous ruling against Spanish International Communications Corp. and Bahia de San Francisco--owners of the stations--clearing the way for the Hallmark acquisitions.