MEXICO CITY, Feb 24 (Reuters) – Shares of Mexico’s Grupo Televisa (TLEVISACPO.MX), the country’s largest broadcaster, fell sharply on Friday after it suffered losses in the fourth quarter and executives confirmed that a potential merger with Megacable (MEGACPO.MX) was essentially dead in the water.
Televisa shares were down 10% on Friday afternoon, a day after the firm reported a net loss of 13.75 billion pesos ($705 million), which it attributed to losses related to TelevisaUnivison and its satellite TV unit.
Analysts at Actinver Equity Research said the results were below expectations and predicted a negative short-term reaction in the stock price.
Shares slid further after Televisa executives, in a Friday morning call with investors, said they were no longer focused on reaching a deal with cable operator Megacable.
Megacable rejected a merger offer from Televisa late last year, but shares of both companies had soared on news of the offer. Following the rejection, Televisa said it was hopeful Megacable would stay at the negotiating table.
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When asked about the negotiations in Friday’s call, Televisa’s co-Chief Executive Alfonso de Angoitia said the firm was now focused on executing its own business plan.
“They (Megacable) were insisting on asking for terms and conditions that were not in the best interests of Televisa’s shareholders and more than that, they were not in line with corporate governance practices for public companies,” he said.
“We have turned the page and now we’re back to executing on our plan, which is looking great,” he added.
Megacable did not immediately respond to a request for comment.
Televisa plans to invest some $820 million in 2023, executives said.
Around $620 million will go to cable TV services, while some $160 million will go to Televisa’s satellite unit Sky and another $40 million will go to other units, de Angoitia said.
Reporting by Cassandra Garrison, Kylie Madry and Aida Pelaez-Fernandez; Editing by Josie Kao
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