Altice USA considers selling Suddenlink for up to $20 bn

Altice USA Inc. is exploring the sale of Suddenlink, which provides cable and internet service in the south-central US, according to people familiar with the matter, as the telecommunications company seeks to pay down its massive debt load.

Altice USA is working with Goldman Sachs Group Inc. on the potential sale, which could fetch as much as $20 billion, said some of the people, who asked to not be identified because the matter isn’t public. The unit has about $1.3 billion in earnings before interest, taxes, depreciation and amortization, some of the people said. Altice USA has begun soliciting interest from potential suitors, they said. The company could still decide to keep the division.

After Bloomberg reported Altice USA’s plans, shares surged 32% to $12.14 at 12:53 p.m. in New York, and rose as high as 43%, a record intraday increase. The company’s market value climbed to about $5.5 billion. It has more than $20 billion in debt.

A representative for Altice USA, based in Long Island City, New York, declined to comment. A Goldman Sachs spokeswoman also declined to comment.

Altice USA Chief Executive Officer Dexter Goei said at an investor conference in May that his company is open to trading, swapping or selling certain assets.

“Suddenlink in itself is a great asset — great growth matrices, under-penetrated markets, less-competitive areas because they’re very rural, but strategically is not a footprint that makes you just sit there and say, ‘Wow, I’ve got the most strategic footprint out there,’” Goei said.

Suddenlink is one of Altice USA’s main cable and internet service brands, along with Optimum, which primarily operates in the New York metropolitan region. Altice USA has announced that it’s merging Suddenlink into the Optimum brand.

Altice USA, spun out of Europe’s Altice NV in 2018, is one of the largest broadband and video services providers in the US, serving more than 5 million residential and business customers across 21 states, according to its website.

The company’s chairman is Patrick Drahi, who’s worth $7.4 billion, according to the Bloomberg Billionaires Index. Bloomberg