Altice USA delivers $1.92B IPO, biggest for telecom since 2000

Altice CEO Dexter Goei and founder Patrick Drahi
Having executed a surprisingly strong IPO, Altice USA chief executive Dexter Goei, right, and Patrick Drahi, founder and top executive for parent company Altice NV, will look to purchase more American cable assets.

Altice USA delivered a strong initial public offering, raising $1.92 billion, the biggest IPO for a U.S.-listed telecom in 17 years.

In an SEC note sent out Wednesday, Altice said it would sell just over 63.9 million shares priced at $30 per unit. 

It’s the second biggest IPO of the year, following Snap Inc.’s $3.9 billion deal in March. In an encouraging sign for the U.S. arm of the European telecom conglomerate, Altice USA had originally targeted an IPO of only around $1.35 billion and ended up selling more shares than anticipated. 

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Altice USA opened trading Thursday at $31.60 a share with its price hitting $31.85 at the time this story was written. 

Parent company Altice NV created Altice USA almost a year ago to the day when it closed on its $17.7 billion purchase of Cablevision Systems, as well as its $9.1 billion takeover of Suddenlink Communications.

Now the fourth-leading U.S. cable operator, Altice USA has clearly stated its intentions to acquire more U.S. cable companies.

The Euro parent will control 70.3% of the U.S. company’s stock and 98.3% of the voting rights. BC Partners purchased 49% of the shares sold in the IPO, with the Canada Pension Plan Investment Board accounting for 32%.

RELATED: Comcast and cable industry downgraded to ‘neutral’ by analyst Moffett

As The Wall Street Journal noted, investors are betting on Altice’s recent track record. Shares of leading U.S. telecoms AT&T and Verizon are down 10% and 15% respectively this year. And investment analyst Craig Moffett just downgraded Comcast and all of cable to neutral, predicting an uptick in cord cutting and a slowdown of growth in broadband. 

Altice NV, however, has seen its European-listed shares grow by around 20% this year.

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