Patrick Drahis Altice International accused of defaulting on €2bn of debt
Creditors say transactions that moved assets out of their reach breached borrowing terms
Creditors of Patrick Drahi’s Altice telecoms empire have accused part of the billionaire’s business of defaulting on more than €2bn of debt, claiming that a series of transactions breached key terms of its borrowing agreements.
A group of creditors owning about €8bn of top-ranking debt at Altice International sent a notice of default on Tuesday to the company, which controls Drahi’s Portuguese, Dominican and Israeli telecoms assets, according to people familiar with the matter.
The creditors were likely to send similar notices relating to the rest of the company’s debt pile, the people said.
The move may trigger a lengthy legal battle between Drahi and his creditors, which could culminate in the lenders demanding immediate repayment of the principal owed to them.
Drahi, a Franco-Israeli telecoms mogul whose sprawling group borrowed more than $60bn of debt in an era of cheap money, has for years been in heated negotiations with creditors across his business empire as he attempts to renegotiate his borrowings.
The notice accuses Altice International of defaulting on more than €2bn of debt due in 2028 and takes aim at a number of transactions that have stripped assets away from Altice International to its lenders’ detriment, including a “drop-down” that took place at the end of last year, which creditors are seeking to overturn.
The “drop-down” transaction removed Altice International’s Portuguese and Dominican assets from the pool of assets available to creditors if debt is not repaid.
Those assets, Altice Portugal SA and Altice Caribbean Sarl, account for about 80 per cent of Altice International’s earnings. Until the end of 2025 they had been pledged as security to the creditors. The price of Altice International’s bonds plummeted the morning after it announced the manoeuvre, before partially recovering.
The creditors’ claim also focuses on about €5bn in inter-company loans that removed value from the group, according to people familiar with the matter.
Alongside the notice of default, Altice International’s secured creditors — including London-based credit funds Sona Asset Management and Arini Capital Management — will enter into a new co-operation agreement that is set to run until at least January 2028. The agreement can be extended to August 2029, which would align with the maturity dates of debt instruments held by the creditor group.
In a move similar to that at Altice International, Drahi’s indebted US cable company last month shifted its most valuable pay-TV and broadband assets outside the reach of creditors, aggravating tensions with some of Wall Street’s biggest asset managers.
The manoeuvre escalated a battle between the billionaire’s US vehicle Optimum Communications, formerly Altice USA, and creditors including Apollo, Ares, Oaktree and BlackRock. Optimum, which has its own $25bn debt pile, said the transfers were intended to hasten a settlement with creditors.
Last year, Optimum sued some of its largest creditors, alleging they were operating a “classic illegal cartel” by banding together to prevent it striking deals with individual creditors.
Altice France also angered bondholders in 2024 by raising the prospect of aggressively shifting assets away from them.
Drahi eventually struck an amicable €24bn restructuring deal with creditors of his French business last year. The deal involved handing a 45 per cent stake in the company to creditors in exchange for a substantial debt writedown to €15.5bn.
The creditor group declined to comment.
Altice International declined to comment.