Altice Expects Cablevision Deal To Be Closed Soon
After investing a massive $17.7 billion, Altice Group hopes that the deal would be closed by April.
The Altice-Cablevision Systems Corporation merger was the center of attention in recent times. The Netherlands based telecom company was trying for a long time to agree on a potential deal for Cablevision that were once the market leader of pay TV cable. The deal was made in order to improve and further boost the business of Altice.
Cablevision acquirer has not been performing well so far and has already given bad news to the investors. According to a source, the poor performance of the year 2015 has resulted in a 5% drop in Altice stock. The company strives towards improving the performance.
Altice Group, owned by Patrick Drahi, completed the acquisition of Cablevision Corporation in September 2015, but the deal was not closed and still pending a regulatory approval. The results that Altice posted were what the market wanted, but considering the situation itself, it was not good enough to stop a massive downfall in its corporate stock in the market. The revenues were stalled at a €17.495 billion, which is a 0.1% decrease from last year’s revenue. The sales of Altice Group also fell 3.5% to $12.2 billion (€11.039 billion) when compared to 2014.
It seems like the company has lost its charm. The operating profit of the group was on a 7.7% year on year increase to $7.4 billion (€6.671 billion). An analyst at Enders Analysis, Francois Godard, said in his speech, “My main worry is that Altice is pilling up new debts again and, needing increasingly more cash to pay back debt, may push Numericable into a direction were it shouldn’t be.”
Sources suggest that the merger deal of Cablevision and Altice is expected to close in the second quarter. The CEO of the Group, Dexter Goei, said that there would not be any further purchases specifically US purchases this year. The Cablevision deal is worth a massive $17.7 billion making it the fourth largest US cable operator in the region. However, the approval is still pending from the New Jersey which might come by April or so. This could delay the further process and parties have to wait to proceed.
The deal would prove to be beneficial in the longer run but Mr. Godard pointed out a few issues, which can be a roadblock in the company’s way if moving forward. He believes that the main issue lies within content, customer experience, and marketing.