Altice offers to buy rest of French cable and telecom unit SFR for $2.7 bn
06 September 2016
Altice NV, the Luxembourg-based cable and telecommunications company controlled by billionaire Patrick Drahi, yesterday offered to pay €2.4 billion ($2.7 billion) in stock to buy the remaining it does not already own in French cable and telecom company SFR Group SA.
Atlice said that full control will allow SFR to diversify into higher growth markets with structural and competitive advantages, particularly in the US.
Altice has offered SFR 8 of its own shares in exchange for 5 SFR for the remaining 22.25 per cent stock it does not already own.
The offer values the SFR stake at €2.42 billion, representing a 2.6 per cent premium based on Friday's closing share prices for the two companies.
In 2014, Atlice, through its telecom unit Numéricable, acquired a controlling stake in SFR from French media giant Vivendi SA for €17 billion ($23 billion). (See: Vivendi agrees to sell telecom unit SFR to Numericable in an over $23-bn deal) With 2015 turnover of €11 billion, SFR is the second largest operator in France after Orange SA with a network covering 99.3 per cent of the population in 3G and 70 per cent in 4G.
Atlice, listed on the Amsterdam stock exchange, has recently gone on a acquisition spree and is reported to have a debt pile of around $50 billion.
Altice had last year acquired New York cable operator Cablevision Systems Corp for $17.7 billion, and later spent $9.1 billion in buying St Louis-based cable operator Suddenlink.
Founded by Drahi, Altice is a multinational cable and telecommunications company with presence in France, Belgium, Luxembourg, Portugal, Switzerland, Israel, French Caribbean, the Indian Ocean regions and the Dominican Republic.
Drahi had an eye on US' second-biggest cable operator Time Warner cable (TWC), after the latter's $45-billion merger with Comcast collapsed because of regulatory concerns.
However, in May, US' fourth-biggest cable operator Charter Communications agreed to acquire TWC in a cash-and-stock deal valued at over $78 billion deal including debt.
Drahi later said that Altice opted not to bid for TWC because the company was not yet ready to make a large acquisition in a new market.