Randy Falco, Univision’s President and CEO since 2011, will retire and leave the company at the end of the year. The news comes just one day after Univision, citing prevailing market conditions, requested to withdraw its initial public offering filing and swapped CFOs, naming Peter H. Lori to the role, immediately replacing Francisco J. Lopez-Balboa, who was hired in 2015 to shepherd the IPO.
Falco’s announced retirement, just months after the 64-year-old media executive signed a two-year contract extension through January 31, 2020, generated several reports suggesting he was being forced out of the company. In response, Haim Saban, Chairman of the Board of Directors for Univision issued a strong statement about the media exec’s exit:
“There are multiple rumors out there and on behalf of the Univision Board I would like to set the record straight about our CEO Randy Falco. Recently Randy came to us and told us that he would like to retire at the end of 2018 when he will turn 65 years old and end an outstanding 8-year tenure as the CEO of Univision. Let me be clear we at the Board of Univision have reluctantly agreed to Randy’s wishes out of respect and the high regard we have for him as a partner.”
In 2014, the investors unsuccessfully tried to sell the company at a $20 billion valuation and may have missed an opportunity last year. According to a Bloomberg story, a source indicated that Univision considered and rejected a $13 billion-plus merger offer from Discovery Communications Inc., which just closed on its acquisition of Scripps Networks Interactive Inc.
The IPO was part of the investors’ exit strategy. The question is, what happens now? And who will be Univision’s next CEO?
Over the past eight years at the helm of Univision, Falco has pushed for diversification of the company’s portfolio, launching millennial-targeted cable network Fusion and investing heavily in digital media companies, leading to the acquisition of the African-American portal The Root, a stake in The Onion and paying $135 million to own distressed Gawker Media. But none of those assets are the company’s big revenue generators.
“During his time as CEO he has modernized the Univision organization, grown earnings and reduced debt at record levels and we could not be more pleased with his performance. We have asked Randy to work with us over the next year in restructuring the company and consult with the board on a transition to new leadership.”
A key factor to consider in any upcoming changes is Televisa. The Mexican media giant bought a chunk of Univision when it invested $1.2 billion in 2010. That deal gave Televisa an initial 5% equity stake in Univision and convertible debt that led another 30% with the right to buy an additional 5% of the company at market prices. In January 2017, the FCC approved a petition to increase Televisa’s stake from a 14.4% voting interest and 10% equity of Univision to a total of 49%.