Altice USA—the American cable TV unit of Netherlands-based Altice NV—confirmed Monday in a Securities & Exchange Commission (SEC) filing that the company will launch an initial public offering (IPO) that would value the company at up to $22 billion while raising up to $1.4 billion in proceeds.
Through its acquisitions of Cablevision Systems and Suddenlink Communications over the past two years, Altice USA has risen to the rank of the nation’s fourth-largest cable system operator with 4.9 million customers across 16 states. Although the timing of the IPO is yet to be determined, the company stated in its SEC document that it intends “to raise significant amounts of funding over the next several years to fund capital expenditures, repay existing obligations, and meet other obligations.” Based on recent remarks by Altice USA CEO Dexter Toei that “it’s part of our core strategy and DNA to continue to look at acquisitions,” observers also predict that proceeds from the IPO will be used in pursuing additional purchases in the U.S. market.
As specified in the SEC filing, between six and seven percent of Altice USA shares will be listed. Three quarters of those shares will be offered by private equity concerns BC Partners and the Canadian Pension Plan Investment Board (CPPIB), both of which will be reducing their current holdings in Altice USA. In all, parent company Altice NV, BC Partners, and CPPIB intend to list 46.6 million non-voting Class A shares at a price range of $27 to $31. Upon completion of the IPO, Altice NV and its affiliates would be left with 75.2% of the company’s capital with the two private equity firms to hold a collective stake of about 17%. Depending on the final price range, Altice USA would also be valued at between $20 billion and $22 billion.