CPPIB and BC Partners Back Altice’s Bid for Cablevision
Posted on 10/28/2015
Amsterdam-based Altice NV is getting financial firepower on its massive bid to buy New York-based Cablevision Systems Corporation, a cable operator. Founded in 1973 by Charles Dolan, Cablevision is one of the largest cable operators in the United States. The deal will make Altice the #4 cable operator in the United States. The French billionaire Patrick Drahi’s dream of creating a cross-Atlantic cable giant is coming true. Drahi is the founder and president of Altice. On September 17, 2015, Altice and Cablevision entered in a definitive agreement for Altice to acquire Cablevision.
Financial Firepower
Canada Pension Plan Investment Board (CPPIB) and funds affiliated with private equity firm BC Partners are committing around 30% of equity in Altice’s move to buy Cablevision Systems Corporation. CPPIB and BC Partners’ BC European Capital IX (BCEC IX) are each kicking in 12% of acquisition in Cablevision, with the rest being backed by co-investors. The amounts CPPIB and BCEC IX are allocating are US$ 400 million each, while the co-investors kick in US$ 200 million.
To make this happen, Altice sold US$ 8.6 billion in new Cablevision debt and used US$ 1.8 billion in new equity to finance the US$ 17.7 purchase of Cablevision. In connection with the transaction, Altice received financing commitment letters from JP Morgan, BNP Paribas and Barclays. Altice advised Cablevision that up to US$ 5.8 billion of Cablevision and CSC Holdings debt will remain outstanding after the transaction is completed.
Earlier in 2015, Altice acquired 70% of St. Louis-based Suddenlink Communications, a U.S. cable company, from BC Partners and CPPIB for US$ 9.1 billion. BC Partners and CPPIB retain a 30% stake in Suddenlink. In negotiations on Suddenlink, CPPIB and BC Partners gained an option to invest pro-rate alongside Altice on any future transactions in North America.
Advisors
The deal is expected to close in the first half of 2016. JP Morgan, BNP Paribas and Barclays acted as financial advisors to Altice. Shearman & Sterling, Covington & Burling, Mayer Brown, Ropes & Gray, De Brauw Blackstone Westbroek and Morris Nichols Arsht & Tunnell acted as legal advisors to Altice. BofA Merrill Lynch, Guggenheim Securities and PJT Partners acted as financial advisors to Cablevision. Sullivan & Cromwell, Mintz Levin Cohn Glovsky and Popeo, and Richards Layton & Finger acted as legal advisors to Cablevision. Debevoise & Plimpton LLP acted as the legal advisor to the Dolan family.
