Altice goes to till
Telecom offers stake to raise $2B
Cablevision-owner Altice USA said Tuesday it will raise cash by selling a minority stake in the telecom.
The shares will help it acquire additional assets in the US, the company said in a regulatory filing.
The filing did not detail how much money Altice intends to raise, but Reuters said it was up to $2 billion.
Only one cable company of any note is still independent — Atlanta-based Cox Communications, which is private.
Back in 2015, Wall Street believed Altice might get together with T-Mobile to form a cable operator with a mobile component — but the tie-up has yet to happen.
In addition to Cablevision, which it bought in 2016 for $17.7 billion, Altice owns Missouri-based cable company Suddenlink, which it purchased in December 2015 for $9 billion.
The acquisitions have left Altice with $24 billion in total debt — with $900 million due this year.
Management at the Bethpage, NY, company, with 3.1 million customers, has promised to create $1 billion in savings through synergies.
As part of its cost-cutting, Altice has already managed to squeeze $190 million in savings via staff cuts, the filing revealed.
Meanwhile the firm’s former Cablevision unit reported pro-forma, pay-TV revenue dipped slightly last year, to $3.11 billion from 2015.
Revenue from broadband in 2016 rose to $1.5 billion from $1.3 billion in 2015.
The company, controlled by self-described pennypincher Patrick Drahi, has certainly cut everything to the bone with the stated aim of reinvesting some of the savings in a better product and service.
Some of the cuts are hitting employees right in their office.
Altice no longer provides staff with cleaning wipes, condiments or plastic utensils, one source said.
Altice is set to keep its 70 percent stake in Altice USA, with private equity firm BC Partners and the Canadian Pension Plan Investment Board holding the balance.