European cable and mobile operator Altice said Wednesday it had bought 70 percent of Suddenlink Communications in a deal that values the seventh-largest US cable company at $9.1 billion (8.2 billion).
“With this acquisition, the Altice Group enters the large and attractive US cable market and takes a further step in diversifying and balancing its portfolio of high-quality businesses,” said a statement from the company, which owns the French cable and mobile operator Numericable-SFR.
With 1.5 million residential and 90,000 business customers in Texas, West Virginia, Louisiana, Arkansas and Arizona, Suddenlink is present in attractive growth markets and generated $2.3 billion in revenue and over $900 million operating profits last year.
“We are very excited about the acquisition of Suddenlink and are highly committed to continue to improve network investment, customer offers and service innovation in the attractive US market,” Altice chief executive Dexter Goei said in a statement.
“Our investment in Suddenlink, our first in the cable sector in the US, opens an attractive industrial and strategic avenue for Altice in the US, one of the largest and fastest growing communications markets in the world,” he added.
Luxembourg-based Altice, which is controlled by French-Israeli billionaire Patrick Drahi, has been on an acquisition drive.
Last year it propelled itself into the major leagues in France when it won a bidding war for mobile operator SFR which it is merging with Numericable.
That deal, worth as much as 14.25 billion euros, was financed mostly with debt, and raised eyebrows as its market capitalisation at the time was just 11.3 billion euros.
It also snapped up the Portugese assets of Portugal Telecom for 7.4 billion euros.
Altice said it would pay $1.2 billion in cash and that most of the Suddenlink transaction would be financed with $6.7 billion of new and existing debt at the US company.
The remainder would be financed by a $500 million vendor loan note and roll over from BC Partners and CPP Investment Board, which will retain a 30 percent stake in Suddenlink.