Media News

Altice USA jumps 7.2 percent in debut

June 22 (Reuters) - Shares of Altice USA Inc rose as much as 7.2 percent in their debut on Thursday, giving the cable operator a market capitalization of $23.71 billion in the second-largest U.S. initial public offering this year.

The 63.9-million share offering raised $1.9 billion after being priced at $30 per share, within the expected range of $27 to $31 per share.

Shares touched a high of $32.17 in early trading.

The company, which Netherlands-based Altice NV put together by acquiring Cablevision Systems and Suddenlink Communications, is only the second U.S. cable operator to go public in the last five years. WideOpenWest Inc raised about $310 million in its IPO last month, which was priced below the expected range.

New York-based Altice USA’s IPO comes at a time when U.S. cable companies are struggling with a downturn in pay-TV subscriptions due to cord-cutting, as consumers ditch traditional cable services to watch content online.

A U.S. listing will allow Altice, the country’s fourth largest cable provider, to keep expanding in the country by way of local acquisitions, and compete better with bigger rivals Charter Communications Inc and Comcast Corp.

Altice USA’s IPO is viewed as a means for founder, Franco-Israeli media mogul Patrick Drahi, to expand his burgeoning U.S. cable empire by giving the company public stock it can then use as currency for new acquisitions.

Following the IPO, 75.2 percent of the company’s shares will be held by its parent, Altice NV, which translates to 98.5 percent of the voting power.

Drahi fattened Altice NV into a telecoms and cable empire through debt-heavy acquisitions in Europe and Israel, and entered the U.S. market in 2015 by acquiring cable company Suddenlink for $9.1 billion.

A few months later, it extended its reach to 20 U.S. states by snapping up Cablevision for $17.7 billion.

Altice USA, which reported a net loss of $76.2 million for the three months ended March 31, expects to use proceeds from the offering to pay down debt of nearly $21 billion. (Reporting By Aparajita Saxena in Bengaluru; Editing by Shounak Dasgupta)