No. 1 U.S. Hispanic network Univision landed exclusive rights to programming, such as popular Mexican soap operas, from the world's biggest Spanish-language programmer, Mexico's Grupo Televisa , in exchange for a larger ownership stake in Univision.

Under the deal announced Thursday, Televisa will invest $375 million in Univision and provide programming exclusively through 2017 to Univision's new U.S. network Telefutura, its flagship Univision network and cable network Galavision.

Univision and Televisa will set up a 50-50 joint venture to bring U.S. viewers Televisa's Spanish-language pay-TV content.

Univision also agreed to buy Televisa's regional music recording business and Latin music label Fonovisa for about $240 million in shares. As part of the overall deal Televisa also acquired 9.1 million Univision warrants that can be exercised any time through 2017 at the current stock price.

The deals signal the growing economic clout of Spanish-speaking Americans, and gives Televisa greater access to a group with a purchasing power of some $500 billion. Televisa's stake in Univision grows to about 15 percent from about 6 percent.

Univision puts added pressure on NBC to find and develop quality programming for No. 2 U.S. Spanish-language rival Telemundo, which NBC recently acquired for about $2 billion.

UNIVISION PLANS MOVIES, SPORTS

Executives from Univision, the No. 5 U.S. network, said they will present movies and sports events in prime time on Telefutura to provide an alternative to highly popular soap operas, known as telenovelas shown in the evening on its main network.

"This has been the real question mark: why will Televisa not be giving programming to Telefutura? Now they are doing that, and getting royalties on the second network," said Rene Pimentel, a Latin America media analyst with Deutsche Bank.

Univision also signed an exclusive programming rights deal with Cisneros Group's Venevision, based in Venezuela. Venevision gets 2.8 million warrants and increases its stake in Univision to 19 percent from 18 percent.

Venevision and Televisa gain greater exposure to U.S. Hispanics, who are targeted every year by some $1.9 billion in advertising.

As part of the deal, Univision will give Televisa a bigger cut of the advertising fees generated from its programming.

"I think it's a great distribution deal enhancing both companies' cross-border capacities," said Matthieu Coppet, a Latin America media analyst for UBS Warburg. "It creates value for Televisa."

Analysts said Univision got a good price for Televisa's underperforming music division.

FONOVISA TO MERGE WITH DISA

Fonovisa is the biggest Spanish-language music label in the world and Univision will merge it with Disa records, the No. 2 label in the same market. Univision acquired 50 percent of Disa in April. About 85 percent of Fonovisa's sales are in the United States. Its artists are mostly Mexican.

Univision and Televisa also agreed to form a joint venture to bring Televisa's satellite and cable TV programming to the United States.

Televisa Chief Financial Officer Alfonso de Angoitia told Reuters in a telephone interview that the Mexican company will give all its current pay-TV content to the new joint venture, including three music channels and two movie channels.

De Angoitia also said the joint venture would develop new productions.

"This is the biggest deal Televisa has done in a long time. It aligns the interests of the two companies to explore new opportunities," he said.

De Angoitia told Reforma newspaper in Mexico City that he valued the 9.1 million warrants at $300 million, equivalent to almost $33 a share.

PRESSURE ON TELEMUNDO

Analysts said the deal could push Telemundo back into the arms of Mexico's No. 2 broadcaster, TV Azteca. The two companies used to have a programming deal, but that ended when Azteca decided to form its own Spanish-language U.S. network, which is still in a fledgling stage.

UBS' Coppet said the Univision-Televisa pact was good for TV Azteca, which is trying to build its own U.S. network, because it signalled high high value for Spanish-language programming.

Univision executives said they would get around limitations on foreign ownership of U.S. media companies because some of Televisa's stake will be through warrants, which are not considered under the law.

Emilio Azcarraga Jean, Grupo Televisa's chairman, president and chief executive, will join Univision's board as vice chairman. He takes over a board seat already held by another Televisa executive.

On the Mexican stock exchange, Televisa closed up 4.08 percent, gaining 0.75 peso to 19.19 pesos per share. Volume was strong at 7.8 million shares. Its American Depositary Receipts (ADRs) rose 4.07 percent on the New York Stock Exchange to $41.90.

Univision fell $1.98, or about 4.96 percent, to $37.92.

Shares in TV Azteca rose .07 peso, or 1.91 percent, to close at 3.73 pesos on the Mexico stock exchange, while its ADRs rose 1.09 percent to $6.52 on the NYSE.