Altice-Cablevision Deal Hits New Bumps

Altice’s $10 billion deal to buy cable operator Cablevision Systems is running into unexpected turbulence in New York City. Since the European telecommunication operator announced the US cable acquisition in September, Cablevision’s shares have sunk further below Altice’s all-cash offer of $34.90 a share. The stock is trading 9 percent below the agreed takeover price, reflecting investors’ concerns about the deal closing. “The spread has widened in large part because people have become increasingly concerned that neither the city nor the state will find that the transaction is in the public interest, or alternatively, they’ll demand so much in terms of givebacks that ultimately the deal won’t be palatable to Altice,” said Craig Moffett, analyst at MoffettNathanson LLC.

New York City has said it has “a number of important concerns” about the merger and believes it has the power to deny the deal if it finds it isn’t in the public interest. Cablevision’s 3.1 million customers are concentrated in the greater New York market. New York Mayor Bill de Blasio’s top legal counsel Maya Wiley said the city is concerned about whether Altice has the financial wherewithal to digest Cablevision without skimping on customer service and infrastructure upgrades for faster Internet speeds. Wiley said the city is also concerned about the impact on jobs. Altice has a reputation for instituting drastic cost cuts.