MercoPress. South Atlantic News Agency

Clarin group presents plan to divide media assets in six different companies

”We want Clarin to adjust to the law, not to hurt (the group),” said Sabbatella

The Argentine media group Clarin presented a plan Monday to divide its media assets into six different companies to comply with a controversial media antitrust law. The move was announced shortly after the head of the authority set up to enforce the law offered assurances that the group would be allowed to keep its most valuable TV and radio licenses.

But the regulator, Martin Sabbatella, said earlier his agency will select the licenses that will be auctioned off after making an assessment of Clarin's holdings.

”We want Clarin to adjust to the law, not to hurt (the group),“ said Sabbatella.

Argentina's Supreme Court upheld the law's constitutionality last Tuesday after a long legal battle in which Clarin charged its aim was to bring the independent media under government control.

The company, meanwhile, said it had presented regulators and the court with a ”plan of voluntary adherence to the media law's licensing regime, in the face of the government's illegal and de facto move in recent days to take its audiovisual media by force.“

It said it had decided to divide its licenses among six different corporate units, each of which would comply with the limits imposed by the law.

Clarin has been highly critical of the administration of President Cristina Fernandez, who has been embroiled in a running feud with its owners.

Passed in 2009, the law says no company can have more than a 35% market share in any category -- broadcast television, cable television or radio, according to Sabbatella. He puts Clarin's market share at 41% in radio, 38% of broadcast television, and 59% of cable television.

The law also says no company can have more than 24 cable television licenses, and Clarin, one of Latin America's largest media conglomerates, has 158.

The company, which had 1.6 billion dollars in revenues in 2011, also owns Argentina's largest circulation newspaper, also called Clarin.

”Clarin is going to keep the licenses with the most economic and symbolic value,“ Sabbatella said in an interview on National Rock radio. ”The objective is to cause the least harm to the company,“ Sabbatella underlined pledging at the same time that jobs will not be threatened.

Clarin External Communications Manager Martín Etchevers said the group submitted its plan to voluntarily adjust to the Broadcast Media Law ”to the AFSCA and the Judiciary.”

According to Etchevers, “the group’s broadcast outlets will divide into six business units” in order to observe article 45 of the Media Law.

Clarin group explained ”this is a decision forced by the circumstances” and added: “this adjustment is not implying, the abandonment of our principles, nor the failure in our rights, which will defend.”

The following is a transcript of Clarin's presentation where it explains the six-unit division:

1) The first unit includes companies Arte Radiotelevisivo Argentino (ARTEAR), owner of Channel 13 license; Channel 12 from Córdoba; Channel 6 from Bariloche and TN news network (Todo Noticias). Also Radio Mitre, with its frequencies AM 790 and FM 100 in Buenos Aires, AM 810 and FM 102.9 in Córdoba, and FM 100.3 in Mendoza. Moreover, included in that unit, there are 24 TV local cable licenses of current Cablevisión, in cities where incompatibility with open TV does not exist.

2) The second unit will maintain most of Cablevisión and Fibertel operations. In it, Fintech fund will maintain 40% of the shares. This unit will add in 24 cable licenses which include Metro, a Buenos Aires City local channel.

3) The third unit will have 20 cable TV licenses of current Cablevisión.

4) Due to another serious defect of the law, broadcast signals (which does not use spectrum, can be created freely, generate production and give Argentine employment) must also be transferred. In this fourth unit, the rest of the signals in which the group participates are included: satellite Channel 13, Magazine, Volver, Quiero Música en mi Idioma, Channel Rural, TyC Sports and TyC Max.

5) In another unit, the following radio services will be included: FM licenses in the cities of Tucumán, Bariloche, Bahía Blanca and Santa Fe.

6) Another unit will include: open TV license of Channel 7 of Bahía Blanca and the participation of Channel 9 of Mendoza.