Altice seeks financing for possible Time Warner Cable bid
Altice, the French Telco, is discussing with several banks to raise debt for a possible bid for Time Warner Cable (NYSE: TWC), the second-biggest US cable operator, according to a newswire report. The talks are a vital step for Altice in putting together a bid for Time Warner Cable, according to Reuters, citing people familiar with the matter.
Time Warner Cable is also being courted by Charter Communications after Comcast Corp abandoned its USD 45.2bn offer for it last month over US antitrust concerns.
Altice is in discussions with banks, including JPMorgan Chase, Nomura, BNP Paribas, Societe Generale, Barclays and Royal Bank of Canada about a financing package to support a proposed acquisition, the unidentified people said in the report, dated 22 May.
The size of the package has yet to be determined and there isn’t certainty that a bid will materialize, some of the people said. The financing could comprise of a dollar-denominated high-yield bond, as well as loans, according to one of the sources. The sources asked not to be identified because the talks are confidential.
Shares of Time Warner Cable surged 3.4% in heavy trading to close at USD 171.18 on the New York Stock Exchange Friday, giving the cable operator a market capitalization of about USD 48.4bn. The bourse in New York is closed Monday for the Memorial Day US holiday.
Altice agreed to buy US regional cable company Suddenlink Communications earlier last week for USD 9.1bn from private equity investors, marking its first move across the Atlantic.
After spending EUR 36bn (USD 40bn) on acquisitions in the last year and a half, Altice will have to be mindful of its finances, according to credit analysts. Moody's put Altice under review for a possible downgrade last week, following the Suddenlink acquisition.
Altice would probably need to issue equity if they want to do a big deal in the next year, said Osant Jaeger, a credit analyst at Moody's, according to the newswire report.
Altice's controlling shareholder, Patrick Drahi, and Time Warner Cable Chief Executive Officer Robert Marcus met in New York last Wednesday, 20 May, as part of preliminary talks between the two companies, according to two of the sources cited by the newswire.
Altice and Time Warner Cable declined to comment. Representatives for the banks either declined to comment or didn’t respond immediately to requests for comment when the newswire report was published last Friday.
Source Newswire Round-up, Wall Street Journal
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