French telecom company Altice to acquire a 70% stake in US cable operator Suddenlink from BC Partners and CPPIB
BC European Capital IX (BCEC IX), a fund advised by BC Partners, and Canada Pension Plan Investment Board (CPPIB), together with management and other co-investors, announced today that they have signed an agreement, whereby Altice S.A. (“Altice”), a multinational cable and telecommunications company, will acquire a 70% stake in Cequel Communications Holdings, LLC (“Cequel”, and together with its subsidiaries, “Suddenlink”). Suddenlink is the seventh largest cable operator in the US. This transaction implies a total enterprise value for Suddenlink of approximately US$ 9.1 billion. Closing remains subject to standard regulatory approvals as well as CFIUS (Committee on Foreign Investment in the United States) approval, and is expected to occur towards the end of 2015.
BCEC IX and CPPIB, together with management and other co-investors acquired Suddenlink in 2012 for a total enterprise value of US$6.5 billion. Upon closing of the proposed sale, it is expected that BCEC IX and CPPIB will each receive proceeds of approximately US$ 960 million and a vendor note of approximately US$ 200 million. CPPIB and BCEC IX will each retain a 12% stake in the company.
“This transaction is an excellent opportunity to realize a portion of the embedded value of CPPIB’s original investment in Suddenlink,” said Mark Jenkins, Senior Managing Director and Global Head of Private Investments, CPPIB. “At the same time, we are retaining a stake in the company which will allow CPPIB to continue supporting Suddenlink through the future growth in its business. We thank the management team for a successful partnership over the past three years. We are now looking forward to developing a long-term partnership with Altice, one of the largest global telecom companies.”
Added Raymond Svider, co-Chairman and a Managing Partner of BC Partners, “Under our joint period of ownership, Suddenlink invested meaningfully into its network, improved its range of services, grew its customer base, and delivered best-in-class operational and financial performance. We thank Jerry Kent and the management team for their achievements and are looking forward to partnering with and supporting Altice in achieving its growth strategy in the United States.”
Based in St. Louis, Missouri, Suddenlink is the seventh-largest cable system operator in the United States and the leading television and Internet service provider in its markets. Suddenlink offers television, high-speed Internet and telephony services to 1.45 million residential and commercial customers.
Latham & Watkins LLP acted as legal advisors to BC Partners and CPPIB. LionTree Advisors acted as financial advisor to Suddenlink in connection with the transaction.
Source: BC Partners Press Release