Altice NV split Altice USA and becomes Altice Europe

by Anjali Athavaley

(Reuters) – Altice (AS:TCAA) NV, the holding of Patrick Drahi listed in the netherlands, has announced a thorough reorganisation of the group with the demerger of Altice USA and a new structure in Europe, where the group will take the name of Altice Europe.

By this reorganization, the giant cable and telecom is continuing its efforts to regain investor confidence, which have massively dropped their titles Altice in the second half of 2017 due to concerns over the financial strength of the group.

This dip’s title has led the group to separate from his chief executive officer Michel Combes, two months ago, replaced by Dexter Goei, right arm of Patrick Drahi.

The action Altice has ended the year 2017 on a fall of 53.5% while the index grouping the values telecom european has only lost 3.6% last year.

Altice has grown massively both in the United States than in Europe, with acquisitions financed by debt, bringing its net debt, of approximately 50 billion euros, more than five times its gross operating surplus (Ebitda) to annual.

“The separation will allow both entities to focus more on value creation opportunities in their respective markets and provide greater transparency to investors”, reads a press release issued late Monday night following a meeting of the board of directors of Altice NV .

The holding, which owns 67.2 percent of Altice USA, hopes to close the transaction by the end of the second quarter of 2018, after obtaining the necessary permissions.

The shareholder Altice NV will be offered 0,4163 ordinary share of Altice USA for each share held.

The board of directors of Altice, USA, has spoken out in parallel for the payment of a dividend of 1.5 billion dollars (1.25 billion euros) to its shareholders prior to the transaction.

“The shares of Altice USA have suffered because of their association with the more mixed success of the mother-house of europe”, noted Craig Moffett, analyst at MoffettNathanson.

Dennis Okhuijsen will be the ceo of Altice Europe, while Dexter Goei will remain at the head of Altice, USA, said Altice. The founder Patrick Drahi will retain control of the two groups via its holding company, Next, in concert with other shareholders, and chair the boards of directors.

Altice Europe wrap by Altice France, Altice International and a new subsidiary of pay-tv.

The press release adds that Altice Europe is progressing in its efforts to dispose of non-strategic assets for debt reduction, including the towers and the subsidiary, Altice dominican Republic.

(With the contribution of Sonam Rai and Supantha Mukherjee in Bangalore, Véronique Tison et Benoît Van Overstraeten for the French service)