Altice to float $1bn of shares in US unit

Alan Burkitt-Gray
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French-owned cable operator to raise at least $1bn in initial public offer of shares

European investor Altice is hoping to raise $1 billion or more by floating shares in its US cable and broadband operations – money that could be used in further consolidation of the industry.

Altice, controlled by French businessman Patrick Drahi, has announced plans for an initial public offer (IPO) of shares in Altice USA, the division through which it owns cable operators Cablevision and Suddenlink – bought in 2015 for a total of $26 billion.

The deal would value Altice USA at more than $20 billion, say a number of analysts, even though that is less than the total purchase price.

Altice USA is the fourth largest cable operator in the country, with 4.9 million customers. At the end of 2016 Dexter Goei, chairman and CEO of Altice USA, announced plans to upgrade the network to deliver 10Gbps to each home.

Altice said in a statement that “the number of shares to be offered and the price range for the offering have not yet been determined”. The company said that four banks – JP Morgan, Morgan Stanley, Citigroup and Goldman Sachs – are joint book-running managers for the proposed offering.

The company has filed a registration statement for the IPO with US authorities but has not yet decided on the timing.

The European Altice holding company, which owns operators in France, Portugal and elsewhere, is expected to retain its 70% stake in Altice USA, say observers, while the minority shareholders are likely to reduce their stakes.