Given the $10 billion in debt the buyers were assuming, the slightest hiccup in the company’s financial performance would have a cascading negative effect.

The buyers, a consortium of investors including entertainment mogul Haim Saban, were counting on several factors to justify the steep purchase price: The nation’s exploding Hispanic population and the popularity of Spanish-language programming, coupled with the promise of robust advertising growth. They expected to hold the assets for a few years then sell at a tidy profit.

But it’s not a perfect world.

In the two years since the buyout, the U.S. economy has collapsed, dragging down advertising to media companies. Adding to the economic distress, Univision has been mired in a costly legal battle with its primary programming partner. The big payday for Univision’s owners, which include well-heeled private equity companies, seems far less certain. Instead of riding a high wave to easy profits, Univision executives have been working furiously to dig out of its hole.

Univision Advertising Market

During the past year, the broadcaster has written down assets by $5.3 billion, and some industry insiders now believe the nation’s largest Spanish-language media company is worth closer to $9 billion – slightly less than what it owes. In January, it settled a nagging lawsuit brought by its longtime programming partner, Grupo Televisa of Mexico, which had threatened to strip Univision of its most popular and profitable shows. The resolution guaranteed Univision the right to broadcast Televisa’s hugely popular soap operas, including “Cuidado con el Angel” (Be Careful With the Angel), through 2017.

Two weeks ago, Univision bought breathing room by refinancing $500 million in debt, pushing back the due date by three years to 2014. The extension means Univision no longer has to worry about burning through its cash in the next two years.

And Univision achieved one of its highest priorities – getting cable and satellite TV operators to pay the company to carry its programming. The agreements with Time Warner Cable Inc., DirecTV Corp., AT&T Inc. and others should bring Univision $175 million in 2009, and as much as $350 million annually by 2014.

Hispanic Advertising consultant, Elvis Arias, offers reviewal of marketing campaigns directed via the Univision venue.