In late December 2017, the FCC sought public comment on whether or not two Mexican citizens—one of whom is a major Univision Communications executive — should be allowed to purchase two FM radio stations in rural Arizona and California.
On Tuesday (5/1), Media Bureau Audio Division Chief Albert Shuldiner rendered his opinion.
A celebratory shot of tequila may be in order.
In a declaratory ruling and memorandum opinion and order released by the Commission, Shuldiner ruled that Deportes y Música Comunicaciones LLC — a subsidiary of the Roberto Medina-helmed Grupo Multimedia LLC — may move forward with the sale of KQMX-FM 105.7, a regional Mexican station licensed to Lost Hills, Calif., that scrapes the Bakersfield market from the west; and KRPH-FM 99.5, licensed to Morristown, Ariz., which holds a Construction Permit to shift to a new transmitter closer to the Phoenix market.
The decision means the buyers can exceed the Commission’s 25% foreign indirect ownership benchmark, with Shuldiner noting that it was in the public interest.
In November 2017, Deportes y Música announced plans to sell KQMX and KRPH. The buyer: SMG-MX LLC, which holds 25% ownership of Deportes y Música Comunicaciones.
Given the FCC’s recent rule change regarding foreign ownership of U.S. broadcast stations, SMG-MX’s two owners — both Mexican citizens — needed FCC approval to take 100% ownership of KQMX and KRPH. This process involved Medina transferring his majority interest in Grupo Multimedia to SMG.
The individuals behind SMG are Juan Carlos Rodriguez, who holds 70%
voting and equity interest in the limited liability company, and Francisco Gonzalez, who holds the remaining voting and equity interest. Rodriguez is President of Univision Deportes — a position he has held since 2012.
Rodriguez and Gonzales explained that the stations “have been in danger of failing” and principal member Roberto Medina “has found it increasingly difficult to devote the time or
funds required to bring the stations to viability.”
Indeed, the Arizona facility has had periods of silence since its 2011 acquisition by Deportes y Musica for $450,000 in a deal brokered by Kozacko Media Services and originally filed with the Commission in April 2010.
KQMX was purchased for $950,000 at or near the same time as the KRPH transaction.
Deportes y Música Comunicaciones acquired KRPH and KQMX from Rick Deitrick’s Magnolia Radio Corporation.
As MB Docket No. 17-360, the FCC opened up a comment and reply comment window.
The petition and the application are unopposed.
In explaining his ruling, Shuldiner noted that granting the petition is likely to “increase the
likelihood of continued service to the stations’ communities by authorizing investment by individuals who are ready, willing, and able to operate the stations based on their current involvement and extensive broadcasting experience; facilitate foreign investment in the U.S. broadcast radio market; and potentially encourage reciprocal investment opportunities for U.S. companies in Mexico.”
There are conditions: SMG must remain in compliance by obtaining prior Commission approval before making any changes to its ownership that may involve foreign ownership.
