Corporate Finance

Altice enters US cable market with Suddenlink acquisition

Altice has also held talks to buy Time Warner Cable

Altice has also held talks to buy Time Warner Cable

French telecommunications group Altice SA announced on Wednesday that it agreed to buy Suddenlink Communications in a deal valued at $9.1 billion.

Controlled by billionaire Patrick Drahi, Altice will acquire 70% of Suddenlink. The French company will finance the deal with $6.7 billion in debt, plus $1.2 billion in cash and a $500 million vendor loan from BC Partners and CPP Investment Board, who will retain a 30% stake.

Altice’s shares have soared 8.2% this morning to €125 following the news.

This deal will give Altice a foothold in the U.S cable market.

“Our investment in Suddenlink, our first in the cable sector in the U.S, opens an attractive industrial and strategic avenue for Altice in the U.S., one of the largest and fastest-growing communications markets in the world.” Dexter Goei, CEO of Altice, said in a statement.

Those familiar with the matter have indicated that Altice has also held talks to buy Time Warner Cable Inc, the second-largest U.S cable operator. Last month the nation’s biggest cable company, Comcast corp., dropped its plan to buy Time Warner Cable Inc. due to regulatory hurdles.

Suddenlink is the seventh-largest U.S cable operator with 1.5 million residential and 90,000 business customers. This is the second time that the company changed its ownership in three years. In 2012, it was bought by BC Partners and CPP Investment Board for $1.99 billion.

Based in Luxembourg, Altice has made a number of acquisitions. Numericable, a French cable operator owned by Altice, acquired the second-largest French mobile carrier SFR in 2014.

Latham & Watkins acted as legal advisers to BC Partners and CPP Investment Board. LionTree Advisors advised Suddenlink.


Image: AP Photo/Thibault Camus - Thibault Camus/AP/SIPA


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