November 10, 2017 / 5:23 PM / a year ago

UPDATE 1-Altice bond slumps on CEO resignation

(Adds investor comments)

By Yoruk Bahceli

LONDON, Nov 10 (IFR) - Altice’s recently issued €675m 4.75% 10.25NC5 senior unsecured note plummeted on Friday after the ouster of its CEO.

The notes dropped over 3.5 points this morning to 92.74 bid, having already traded down from as high as 102.28 last Thursday before the company released quarterly results. The losses were later reversed with the bid back to 96.50 by mid-afternoon.

The Netherlands-based telecom ousted chief executive Michel Combes and brought back founder Patrick Drahi as president on Friday, seeking to reassure investors after its shares lost around 30% in the past week.

The company issued cautious full-year targets amid slightly weaker than expected third-quarter results after the market close on November 2.

“Drahi made his money by leveraging up and buying companies,” said one investor.

“The question has always been moving from financial engineering into operational engineering, and that’s one the things Altice seems to be getting stuck on.”

The long 10-year deal was issued early October in conjunction with a €1.07bn-equivalent loan split between euros and dollars.

Altice’s losses are coupled with a softening of the high-yield market in recent days with the iTraxx Crossover widening about 19bp since Monday’s open and now bid around 244bp. (Reporting by Yoruk Bahceli; Julian Baker, Alex Chambers)

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