USA’s fourth largest cable giant Altice raised $1.9 million in an Initial Public Offering (IPO) on Wednesday. Considered to be the second largest IPO in the U.S. this year, this particular action will give Altice a market capitalization of around $22 billion. According to some equity research analysts, Altice USA might be having future ambitions of acquiring bigger players in a similar field like Charter Communications and Cox Communications.

According to a report by CNBC, the current move to go public clearly indicates that its founder Patrick Drahi might have plans to utilize the traded shares into further acquisitions in the near future.

If that comes true, Altice will soon emerge as the Market Leader in the US cable TV operator industry.

Key facts about Altice USA:

  • Altice is the fourth largest cable operator in The USA with an annual revenue of $9.2 billion, as per reports published in 2016. The other major players in this domain are Comcast, Time Warner Cable and Charter Communications.
  • Altice was formed by its parent company Altice, a Netherlands-based cable operator, by acquiring Cablevision and Suddenlink Communications in September 2015.
  • Currently, Altice is operative in 21 states across the United States.
  • The parent company Altice will have 70.3 percent shareholding of Altice USA as well as 98.3 percent of the voting rights.
  • Two minor investors, BC Partners and Canada Pension Plan Investment Board will jointly hold a minority stake in Altice.
  • The stock will be notified by the ticker ‘ATUS’ and will be available for trading on Thursday in the New York Stock Exchange.
  • The company spokesperson of Altice said they have plans to pay off some debts that are close to $22 billion with the amount raised from the IPO proceedings.
  • The estimated stock price was in the range of $27 to $31 and ultimately Altice USA priced 63.9 million shares of the company at $30 each.

The current scenario of The U.S. cable industry

The event was talked about as it is the only U.S. cable operator that went public in the last five years.

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The key players in the industry are already listed and the relatively smaller organizations prefer getting acquired than going public. The cable industry is facing fierce competition as most customers favor fast internet-streaming over cable TV services.

These companies have lost a major chunk of their business and most of the companies are looking for the diversification or the M&A route to stay profitable. Some have been forced to slash prices to retain their existing customers. The present scenario is not favorable for cable TV operators and in this situation the Altice USA IPO launch is a remarkable move for sure.