is the second largest
Mexican Television Network . It was established in
1968 as the state-owned '''Instituto Mexicano de la Televisión''' ("Imevisión"), and was privatized under its current name in
1993 . Its flagship program is the newscast ''
Hechos ''.
In Mexico the network operates two stations:
XHDF ("Azteca 13") and
XHIMT ("Azteca 7"). Both enjoy near national coverage, mostly via over the air tv, cable TV, and DBS. It also operates Two
HDTV stations Azteca 24 HD which airs different programing than that of analog channel azteca 7, and Azteca 25 HD which shows programming from analog Channel Azteca 13. Azteca 13 can also be seen live online via TV Azteca's website.
The network also operates ''Azteca 13 Internacional'', reaching 13 countries in Central and South America.
TV Azteca subsidiaries include the
Azteca América network in the
United States (co-owned with
Pappas Telecasting );
Todito.com , a
Web Portal for North American Spanish speakers; and
Unefon , a Mexican mobile telephony operator focused on the mass market.
On
July 18 ,
1993 , Mexico's
Finance Ministry (
Secretaría De Hacienda Y Crédito Público or SHCP) announced that
Radiotelevisora Del Centro , a group controlled by
Ricardo Salinas Pliego , was the winner of the
Auction Process to acquire the "state-owned media package" that included Imevisión. The winning bid amounted to US$645 million.
Rival bidders included:
On
5 January 2005 the
U.S. Securities And Exchange Commission (SEC) accused TV Azteca executives (including chairman
Ricardo Salinas Pliego ) of having personally profited from a multi-million-dollar debt fraud committed by TV Azteca and another company in which they held stock. The charges are among the first brought under the provisions of the
Sarbanes-Oxley Act of 2002, introduced in the wake of the
Corporate Financial Scandals of that year.
On ,
Nortel and
Codisco . The aggregated amount of the financial penalties equals approximately
US$ 2.3 million, of which the CNBV intends to impose upon TV Azteca a penalty equivalent to approximately US$50,000.
April 30 ,
2005 ,
Finance Secretary Francisco Gil Díaz asked prosecutors to bring criminal charges against TV Azteca Chairman Ricardo Salinas Pliego on allegations he used privileged information to trade shares, people familiar with the matter said.
Gil Díaz's fiscal prosecutor filed the 1,200-page request to charge Salinas Pliego, who controls the No. 2 broadcaster, with the
Attorney General 's Office (PGR) April 27, said the people, who asked not to be identified. Regulators yesterday separately fined Azteca, its chairman and board member Pedro Padilla US$2.3 million for securities law violations.
The proposed criminal charges go beyond a civil suit brought by the SEC on
January 4 that accused Salinas Pliego and his company of securities fraud for hiding a transaction that netted him US$109 million.
Just a few days before the charges were formalized, TV Azteca dennounced a
Blackmail attempt by Gil Díaz to avoid the transmission of an investigation by Azteca's reporter
Lilly Téllez of alleged corruption acts during the
1994 Economic Crisis In Mexico . According to TV Azteca, the charges made by Gil Díaz were in retaliation for the transmission of Téllez report. The rest of the media found the accusations incredibly weak and, given the timing, suspicious: their proof was an unsigned document printed on plain paper stating the terms of the blackmail, supposedly given to a TV Azteca representative by Gil Díaz himself in his own office.
The case will test the country's insider-trading legislation for the first time since the government toughened the law in 2001 to criminally prosecute violators.
"There's recognition worldwide that until securities law violators are prosecuted criminally, civil enforcement will have a limited deterrence effect," said Jacob Frenkel, a former U.S. federal prosecutor and SEC enforcement lawyer who is now a partner at Shulman Rogers in
Rockville, Maryland .
Salinas Pliego, 49, made a US$109 million profit in 2003 after buying debt that TV Azteca phone unit Unefon SA owed to Nortel Networks Corp. for a discounted price, and then receiving repayment from Unefon at full value three months later, the SEC said in January. The SEC alleged Mexico City-based TV Azteca, whose shares trade in both Mexico and the U.S., failed to tell shareholders about the transaction.
The SEC requires companies to disclose so-called relatedparty transactions because they may involve conflicts of interest.
Dan McCosh, a spokesman for Salinas Pliego and the companies he controls, declined to comment on the possibility of criminal charges. Salinas Pliego and TV Azteca denied any wrongdoing Thursday and said they would appeal the administrative fines imposed by regulators, according to a statement sent to the Mexican stock exchange.
In September, Salinas Pliego told reporters he wasn't concerned about the SEC investigation. "We are totally convinced we acted correctly, and we are going to defend ourselves," he said.
Mexican regulators started investigating Salinas Pliego and the companies he controls in December 2003, after TV Azteca's outside lawyers publicly expressed concern about the Unefon debt transaction.
Analysts from
Merrill Lynch & Co. Inc. ,
JPMorgan Chase & Co. and
Deutsche Bank reduced their recommendations on TV Azteca stock on Jan. 8, 2004, after the company disclosed details of the Unefon transaction, sending the shares 11 % lower that day to 5.52 pesos. TV Azteca fell 2.8 % in trading today to 5.49 pesos, down 22.4 % this year. Its American Depositary receipts fell 13 cents, or 1.6 %, to US7.99.
Gil Díaz asked Congress last month to revise legislation to expand shareholder rights and facilitate company share listings to spur the stock market. The changes would add to amendments made in 2001 that defined the information controlling shareholders and companies must disclose to minority investors.
The bill that Gil Díaz is now proposing would replace Mexico's 30-year-old securities law and reduce by two-thirds, to 5 %, the amount of stock shareholders must own to bring lawsuits against company executives, among other provisions. He said the new law won't be as strict as U.S. legislation.
TV Azteca is infamously known for its attacks on Javier Corral (ex Congressman, PAN) for his opposition to the Ley Federal de Radio y Television (LFRT). The latter was a proposal of law concerning the licensing and regulation of the electromagnetic spectrum. The LFRT was favourable to both TV Azteca and Televisa (who together control 95 percent of all television frequencies) because it allowed them to renew their licenses without paying for them. Javier Corral, by leading the campaign against the LFRT, became the object of attacks by TV Azteca.
These attacks were of such nature that the Permanent Commission of the Congress of Union had to vote an 'Agreement Point', condemning the overtly propagandistic campaign by the 'TV broadcasters' against Corral and another ex-Senator,
Manuel Bartlett . However, in the original proposal of 'Agreement Point', only TV Azteca was mentioned, for Televisa did not attack either of the former. See
[http://www.reforma.com/editoriales/nacional/778321/
According to The Economist, the Ley Federal de Radio y Television "raced through Congress confirming the country's longstanding television duopoly" and constituted a "giveaway of radio spectrum and a provision that allows broadcasting licenses to be renewed more or less automatically".
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