Cable and telecom investor Altice has agreed a US$17.7 billion deal to acquire US cable player Cablevision.
Altice boss Patrick Drahi’s latest mega deal will see the Netherlands-based company pay US$34.90 in cash for each share – a premium of about 22% on yesterday’s closing price – in the fourth largest US cable provider in a move that will radically expand its US footprint following its acquisition of number seven operator Suddenlink.
Cablevision is the leading player in the New York metropolitan area, with networks covering New York City, New Jersey and Connecticut, a zone of high population density but one that is intensely competitive.
The Cablevision network passes over five million homes and serves 3.1 million homes and businesses. About 65% of customers subscribe to triple-play services.
The acquisition also includes Cablevision’s enterprise-focused business unit Lightpath, local television news network News 12 Networks and publishing outfit Newsday Media Group, as well as Cablevision’s advertising sales division.
Cablevision generated US$6.525 billion in revenue and US$1.858 billion in operating cash flow in the year to June.
The deal places Altice, owner of assets including Numericable-SFR in France and Portugal Telecom, at the heart of the consolidation of US cable.
According to Altice, Cablevision and Suddenlink will draw upon management from both companies creating a leading communications services and technology group in the US market with 4.6 million customers in 20 states. Both companies will benefit from this national platform and from operating efficiencies and economies of scale.
“As a family business 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. The strategy of Altice in the large and highly strategic US 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,” said Drahi.
“We are very excited about our acquisition of Cablevision, which has developed into a pre-eminent cable operator under the steady, long-term ownership of the Dolan Family. This acquisition, our second in the cable sector in the US, is the next step in Altice’s long-term oriented strategy in the US, one of the largest and fastest growing communications markets in the world,” said Dexter Goei, CEO of Altice.