European telco Altice Group has confirmed that it plans to fund its recently announced acquisition of US cableco Cablevision by selling new stock valued at EUR1.8 billion (USD2.0 billion). According to a company filing, Altice plans to sell as many as 69.998 million Class A shares and up to 24.833 million vote-rich Class B shares. The new equity capital represents up to 10% of the issued share capital of each class of stock, the telecoms group has stated.
The stock sale represents the first one since Altice created a new Dutch holding company (Altice NV) in August to allow founder Patrick Drahi to retain control of his growing telecoms empire while using stock to finance acquisitions. Altice claimed that the deal, which closed in August this year, would help to ‘provide greater flexibility for financing and corporate transactions’ via the issuance of both Class A and Class B shares.
As previously reported by TeleGeography’s CommsUpdate, last month Altice entered into a definitive agreement to acquire New York-based Cablevision for a total value of around USD17.8 billion, which will be financed with USD14.5 billion of new and existing debt at Cablevision, cash on hand at the cableco, and USD3.3 billion of cash from Altice. The deal represents Altice’s second US deal, following the previously announced USD9.1 billion acquisition of 70% of the shares in Suddenlink in May this year.