Altice USA Chief Says M&A 'Definitely’ on the Agenda
But smaller, ‘bite-sized’ deals may be more practical
With its nearly $4 billion bid to acquire Atlantic Broadband all but a memory, Altice USA CEO Dexter Goei told analysts Wednesday that the company still wants to grow via acquisitions, and has its eye on a handful of potential “bite-sized” deals.
“We definitely want to go out there and find attractive MVPDs to acquire,” Goei said on a conference call to discuss Q4 results. He added that while there are a handful of smaller operators to acquire, that field is narrowed, due to geographic and competitive reasons, is further narrowed down to “a couple.”
Altice USA teamed up with Canadian telecom company Rogers Communications to launch an unsolicited bid for Atlantic Broadband parent Cogeco in a deal valued at about $7.8 billion. Altice USA originally said it would spend $3.6 billion for Atlantic Broadband, upping that bid to about $3.9 billion, but was continuously rebuffed by Cogeco’s controlling shareholder. After several attempts to get a deal done, Altice USA officially abandoned the effort in November.
Also Read: Altice and Cogeco: He’s Just Not That Into You
Goei echoed his Q3 comments concerning future M&A, in that small deals, like its July purchase of Service Electric Cable TV of NJ for $150 million, are just as appealing as the bigger transactions.
“The bite-sized, Service Electric-type acquisitions are very attractive for us,” Goei said. “Hopefully, we’ll be able to unlock one of those this year. But we’ll continue to try to unlock as many of those as possible.”
Goei said that in the absence of M&A, Altice USA would use those resources to buy back its stock. But he added he wouldn’t turn down a large deal if it came along.
“If something like an Atlantic Broadband comes up for sale, or even a larger size than that, we definitely continue to believe that M&A is the best use of our capital if anything is available,” Goei said.
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Mike Farrell is senior content producer, finance for Multichannel News/B+C, covering finance, operations and M&A at cable operators and networks across the industry. He joined Multichannel News in September 1998 and has written about major deals and top players in the business ever since. He also writes the On The Money blog, offering deeper dives into a wide variety of topics including, retransmission consent, regional sports networks,and streaming video. In 2015 he won the Jesse H. Neal Award for Best Profile, an in-depth look at the Syfy Network’s Sharknado franchise and its impact on the industry.