Altice on Thursday agreed to acquire U.S. cableco Cablevision in a deal worth US$17.7 billion, the latest step in the Netherlands-based telco group’s aggressive global expansion plan.
Cablevision’s network passes 5 million premises across New York, New Jersey and Connecticut, and it currently serves 3.1 million residential and business customers. 65% of its subscriber base have signed up to a triple-play bundle. In the 12 months to 30 June, the company generated revenue of $6.53 billion.
Altice has offered $34.90 per share for Cablevision, a 22.3% premium on the company’s closing price on Wednesday.
It is Altice’s second multi-billion-dollar deal in the U.S. this year.
In May, it agreed to take over Suddenlink – a cableco serving 1.5 million residential customers across Arizona, Arkansas, Louisiana, Texas and West Virginia – for $9.1 billion.
Acquiring Cablevision leaves Altice with 4.6 million customers, making it the U.S.’s fourth-largest cable company.
"The strategy of Altice in the large and highly strategic U.S. market is reinforced with the acquisition of Cablevision. We will be in a stronger position, as in all other markets in which we operate, to deliver the best services, invest in the most advanced technology, and develop innovative products for the benefit of our customers," Altice founder Patrick Drahi, in a statement.
Cablevision was founded by the Dolan family in 1973 and remained a family-run enterprise until today.
"The time is right for new ownership of Cablevision and its considerable assets. We believe that Patrick Drahi and Altice will be truly worthy successors, and we look forward to doing all we can to affect this transition for our customers and employees," said Cablevision CEO James Dolan.
"We expect that Cablevision will be in excellent hands," he said.
"We are proud to be entrusted by the Dolan family with the ownership of Cablevision and look forward to continuing the pioneering path they have paved for us," Drahi added.
The transaction will be funded by $14.5 billion of new and existing debt at Cablevision and $3.3 billion in cash from Altice, which it will raise by issuing new shares. BC Partners and CPP Investment Board – which used to control Suddenlink and retain a minority stake in the company – have the option to acquire 30% of Cablevision’s equity as part of the deal.
"This acquisition, our second in the cable sector in the U.S., is the next step in Altice’s long-term oriented strategy in the U.S., one of the largest and fastest growing communications markets in the world," said Dexter Goei, CEO of Altice.
Altice expects the deal to close in the first half of 2016, pending regulatory approval.
