A day after it said it would withdraw its plans for an initial public offering, Univision Communications could be in line for even more changes. The company confirmed late Wednesday (March 7) that long-time CEO Randy Falco has approached the board about retiring early – at the end of this year – amid reports that the Spanish-language content giant is mulling a restructuring that would drastically reduce costs.
Univision withdrew its IPO documents Tuesday (March 6), ending a three-year odyssey for the programmer. Univision set the IPO engine in motion in 2015, and even brought in former Goldman Sachs banker Francisco Lopez-Balboa as chief financial officer to head up the effort. Lopez-Balboa resigned on Tuesday. He was replaced by long-time Univision executive Peter Lori.
Falco was said to be on increasingly thin ice in the wake of the IPO withdrawal – it was seen as the main exit vehicle for the investors that took the company private in 2007 for $13.7 billion, including Providence Equity Partners, media mogul and Univision chairman Haim Saban, TPG Capital and Thomas H. Lee Partners.
In a statement, Saban confirmed that Falco had approached the board earlier about accelerating his retirement, and that the board “reluctantly agreed” to his request.
“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,” Saban said in a statement. “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. 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 report in the Wall Street Journal late Wednesday said the board of directors was considering replacing Falco. The report added that the Univision board also is contemplating making drastic cost cuts – up to $200 million – which could result in significant layoffs, to prepare itself for a sale. Univision had fielded several offers in the past – including one from Liberty Media chairman John Malone – but rejected them as too low.
Univision has struggled to pull the trigger on the IPO – it has postponed the offering several times due to unfavorable market conditions. The decision to finally scrap the offering could mean that it is willing to pursue a deal.