Univision Communications Inc. still faces a key regulatory hurdle in its proposed $2-billion acquisition of Spanish-language radio chain Hispanic Broadcasting.
Regulators at the Federal Communications Commission said in a letter this week that Univision's plan to assuage antitrust concerns by reducing its influence over another Spanish- language firm might not be enough.
The FCC letter marks an unexpected holdup. A few weeks ago, Univision announced that it had reached a tentative deal with the Justice Department to obtain approval for the Hispanic Broadcasting purchase. Both agencies must sign off on it.
The company said it reached the tentative deal with the Justice Department by agreeing to cut its 27% stake in Entravision Communications Corp., which is the biggest owner of Univision TV affiliates and has more than 50 radio stations, many of which compete with Hispanic Broadcasting's outlets.
The tentative pact led analysts to reason that the purchase appeared to be all but certain.
In the letter, however, FCC officials expressed caution about an element of the accord that would allow Univision to weigh in on any sale or merger involving Entravision or any of its Univision-affiliated TV stations.
Retaining the right to approve the sale of Entravision's Univision affiliates "would give Univision excessive influence over decisions taken in the ordinary course of Entravision's business," the FCC said.
An FCC spokeswoman declined to comment other than to say "the transaction is still under review."
Univision also declined to comment Thursday.
But in a letter to the FCC, the Los Angeles-based media giant said keeping control of affiliate station sales is "fully consistent" with previous regulatory rulings.
Univision said the Justice Department had concluded its antitrust review, and allowed the company to retain its control of any station sales. The company said it expected to sign a consent decree with the Justice Department in the next few days.
Univision shares rose $1.66 to $23.91 on the New York Stock Exchange.