Spanish Broadcasting System Shareholder Wants Spinoff Of Mega TV And Films

Shareholder Unrest

A Schedule 13D filed with the SEC by ATTIVA CAPITAL regarding its stake in SPANISH BROADCASTING SYSTEM says that the investor is discussing its idea that SBS should spin off its MEGA TV and MEGA FILNS divisions, selling them to a "bigger media company that has the financial resources, the content and distribution network required to make MEGA TV & FILMS a successful franchise in the Hispanic market in (the) U.S. and LATIN AMERICA." 

ATTIVA suggests TIME WARNER as a possible partner to take MEGA TV up against UNIVISION and TELEMUNDO, and adds that the proceeds could be used to "pay down debt, strengthen its balance sheet and eventually return some capital to its shareholders in the not so distant future."  Under ATTIVA's plan, SBS would keep a "strategic minority interest" in the TV and film business and concentrate on its core assets of radio, interactive music, entertainment, and its events division.

ATTIVA also says that the Board should "improve Corporate Governance by separating the roles of Chairman and CEO and stay true to its motto 'the largest publicly traded Hispanic-controlled media and entertainment company in the UNITED STATES' by running SBS as a public company and not as a 'RAUL ALARCON Company' as it has advertised in (sic) some radio stations."  The filing asks SBS banker LAZARD LTD. to convince the Board and ALARCON about "the right course of action" and to add a new board member to represent the interest of minority investors (Class A Shareholders).

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