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Altice, the French cable group, is planning to sell its telecoms network in the Dominican Republic as part of plans to dispose of non-core assets to reduce leverage and improve its financial position.
Altice has marked the Caribbean business for disposal and plans to sell it in an auction as part of its efforts to cut debt and reassure investors after seeing its share price halve this month, according to three people briefed on the plans.
The sale process of Altice Dominican Republic, a subsidiary of the Luxembourg-based holding company, is still in the early stages and plans could change, one of the people said. A spokesman for Altice declined to comment.
Earlier this month, Altice founder Patrick Drahi reinstated himself as chairman and the company’s chief executive resigned. Poor third-quarter results compounded investor concerns over Altice’s €51bn mountain of debt and highlighted continuing operational issues in its largest market of France.
Last week Altice announced that it plans to shun expensive dealmaking and de-leverage its balance sheet by disposing of non-core assets, including its mobile masts in Europe. At group level, Altice’s gross leverage after a spending spree that saw it acquire more than 30 companies in the past 15 years stands at 5.5 times earnings before income, taxes, depreciation and amortisation.
Altice said on Monday that it has initiated processes to begin the mobile masts disposal as early as the first half of 2018. It has also earmarked for disposal a small business in Switzerland focused on business customers that is valued at a couple of hundred million euros, according to two people familiar with the plans.
Altice bought the Dominican Republic unit in 2013 for €1.1bn from French telecoms group Orange. It delivers mobile and fixed services to more than 4.8m customers in the country. In 2016, Altice Dominican Republic recorded €717.5m in revenues and €185.2m in operating profit — roughly 3 per cent of the group’s overall revenues last year.
Altice outbid Cable & Wireless, now part of Liberty Global’s Lilac division, for the Dominican business. Lilac, which has been separated from Liberty Global in part to pursue acquisitions in Latin America and the Caribbean where it operates, is seen as an obvious buyer for Altice Dominican Republic, which generates huge amounts of roaming revenue from the tourist trade. A spokesman for Liberty Global declined to comment.
On Tuesday Altice announced another management shake-up, this time at subsidiary Portugal Telecom, which will see it replace its chief executive in Portugal for the second time in four months.
Claudia Goya, who joined Altice in July as chief executive of Portugal Telecom, will become chairman of the division, and Altice’s chief technology officer Alexandre Fonseca was promoted to chief executive. Paulo Neves, Portugal Telecom’s chairman and former chief executive is leaving the group.
Mr Drahi also sought to reassure Portugal Telecom’s employees about Altice’s commitment to Portugal, following claims by a rival that Altice’s plan to acquire Media Capital, the media group that owns national commercial broadcaster TVI, is dead.
Mário Vaz, the chief executive of Vodafone Portugal, said in a national newspaper on Tuesday that he believes that Altice’s acquisition of Media Capital has been “rejected” and said it would be “bad for the country”.
A person close to Altice said that the deal, which was announced in July, is still being reviewed by antitrust regulators and should be completed in the coming months.
In an email to Portugal Telecom’s employees, seen by the Financial Times, Mr Drahi wrote: “Portugal is today one of our biggest bets in the world. Our commitment to the country, to the economy and to innovation is to continue to build a strong, solid, modern and capable Altice/Portugal Telecom group.”
Mr Drahi has spent the past two weeks trying to reassure Altice’s employees and investors, telling them that the group is financially stable despite the decline in its share price. Its debt is guaranteed at 85 per cent with fixed rate and has no major maturities coming up for renewal until 2022.