By Stuart Thomson       

Mexican media giant Televisa has made an offer to combine its cable and broadband subsidiary Izzi with rival pay TV service provider Megacable, according to Reuters, citing an offer document it has seen.

According to Reuters, Megacable has yet to accept the offer.

The all-stock proposal would see Megacable’s shareholders own about 45 per cent of the merged company, with Televisa holding the remaining majority stake.

According to the report, the offer places a 19 per cent premium on Izzi. Televisa has also proposed to offer a special dividend to Megacable shareholders on the deal closing.

The new Megacable would remain publicly listed.

According to the document seen by Reuters, Televisa contends that the combined entity would create one of the country’s leading cable operators that would be better placed to compete than the individual companies.

Televisa’s cable unit passes about 18.7 million homes in Mexico, with 15.6 million revenue-generating units.

The company also owns satellite pay TV operator Sky, with about 7.3 million RGUs.

Megacable has 4.3 million subscribers and 10.9 million RGUs.