Luxembourg-based telco Altice intends to raise €750m (US$1bn) through a listing on NYSE Euronext in Amsterdam uniquely to pay down debt.
The operation will see 25% of the company floated and is scheduled to price in the next four weeks.
Goldman Sachs…
Luxembourg-based telco Altice intends to raise €750m (US$1bn) through a listing on NYSE Euronext in Amsterdam uniquely to pay down debt.
The operation will see 25% of the company floated and is scheduled to price in the next four weeks.
Goldman Sachs and Morgan Stanley are acting as joint global coordinators.
The offering will comprise new stock and a sale of shares held by Next LP, the holding company for the founder and executive chair Patrick Drahi, and selected members of management. The existing shareholders will offer investors an over-allotment option.
In addition to the global coordinators, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC and Morgan Stanley are joint bookrunners, while Credit Agricole and ING are joint lead managers.
In a statement, Drahi said: “This listing will provide investors with the opportunity to acquire an interest in a high-quality multinational cable company with a proven track record of value-creative M&A and a strategy to explore value-creative M&A opportunities going-forward.”
Under the terms of the IPO, Altice’s existing shareholders will enter into a 365-day lock-up after the listing, during which they cannot sell their shares without the permission of the joint global coordinators.
Altice has also committed not to release more equity for 180 days, although the terms do allow an additional issuance in the context of an M&A transaction and certain other scenarios.
On a conference call today, CEO Dexter Goei indicated that the company did not have any further stock offerings in the pipeline. “Our intention is to get diluted through acquisitions,” Goei said.
In its presentation to potential investors, Altice said it has identified up to 10 in-market consolidation opportunities, four opportunities to grow in new markets, and three non-cable telecom opportunities.
Goei added that SFR and Bouygues Telecom are possible targets in France, but Altice is not looking at mobile network operators in Belgium as it does not see its cable footprint as large enough for it to make sense.
“We are the Liberty Global of the smaller telecoms opportunities today, which is one of the reasons we’re going to the public markets,” Goei said. “We’d like to do larger transactions – as Liberty Global does – in our existing markets or maybe new markets.”
In 2013 Altice recorded €1.1bn in pro forma adjusted EBITDA for the first nine months of the year and made a number of additions to its portfolio, most notably in the Caribbean with its US$1.4bn purchase of Orange Dominicana.
Altice has operations in France, Belgium, Luxembourg, Portugal, Switzerland, Israel, a number of French Overseas Territories, and the Dominican Republic.
Its most high-profile holding is its 40% stake in Numericable, valued at around €1.4bn (US$1.9bn) following the French cableco’s IPO last year.
Altice made its first acquisition in 2002 and says it has completed 20 deals overall, including 13 in the last five years.
If successful, the Altice listing will further illustrate the strong appetite of investors for cable assets in the last few years.
In 2013, US giant Liberty Global (LGI) acquired UK counterpart Virgin Media in deal worth €17.2bn (US$23.3bn), while Numericable’s IPO was priced at top-end, reaching €750m.
Meanwhile, LGI is rumoured to being close to reaching an agreement to buy Dutch cableco Ziggo, which was successfully listed for €925m in 2012.
