Altice to sell 49% of network to Morgan Stanley for €2.32bn

Altice to sell 49% of fibre network to Morgan Stanley for €2.32bn

16 December 2019 | Natalie Bannerman

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Altice Europe subsidiary MEO has signed an agreement with Morgan Stanley Infrastructure Partners for the sale of 49.99% in Altice Portugal FTTH for €2.32 billion.

The deal will create a new nationwide fibre wholesaler in Portugal with Altice Portugal FTTH selling wholesale services to operators while MEO sells technical services to Altice Portugal FTTH for the build, subscriber connection and the maintenance of the network. The deal is due close in the first half of 2020.

“I am very pleased that our partnership with Morgan Stanley Infrastructure Partners, initiated in the context of our Portuguese tower transaction in 2018, now continues with a transformational fibre project. Following this transaction, Altice Europe has obtained cash proceeds in excess of €5.7 billion through the transformational SFR FTTH transaction and the various tower sales and partnerships announced in 2018. Altice’s portfolio of infrastructure assets continues to grow,” said Patrick Drahi (pictured), founder of Altice.

Valuing the company at €4.63 billion the payment terms for the transaction are as follows:

  • €1,565 million to be paid in 2020
  • €375 million to be paid in December 2021
  • And €375 million due in December 2026

“On a 100% proforma basis, SFR FTTH and our towers in France in addition to our fibre and towers in Portugal, already represent more than €0.8 billion of revenues and more than €0.5 billion of EBITDA, effectively constituting one of the largest telecom infrastructure groups in Europe,” continued Drahi. “We continue to focus on deleveraging Altice Europe through growing revenues and EBITDA, supplemented with the disposal proceeds from this transaction. This fantastic transaction with our long-standing partners at Morgan Stanley Infrastructure Partners will accelerate the deleveraging of the Group towards its stated leverage target. It will open the way to significant refinancing transactions in 2020 enabling us to accelerate our announced program of debt interest reduction (target of €0.7 billion annual savings).

On track to surpass more than 4 million homes by the end of the year, Altice Portugal FTTH is the largest fibre provider in the country. All of MEO’s fibre assets in Portugal including FTTH and dark fibre, are included in Altice Portugal’s assets.