Altice USA decides to keep Suddenlink assets after all

In a game of deal or no deal, it looks like Altice USA has chosen the latter. The operator announced on Thursday it has decided not to sell its Suddenlink assets, several months after confirming rumors that it was in talks with several parties looking to strike a deal.

The company released a concise statement indicating the sale discussions were part of a strategic review of options for its Suddenlink business. “Following this evaluation, the Board of Directors has unanimously determined that continuing to operate Suddenlink and pursuing the company’s long-term business plan represents the best path forward for Altice USA and its stockholders,” it said.

That long-term plan, of course, is to blanket two-thirds of its overall territory with fiber by the end of 2025. Though it was only planning to cover around 200,000 locations in its Suddenlink footprint with fiber this year, it is aiming to boost that number to 600,000 locations in 2023, 900,000 in 2024 and 800,000 in 2025.

Rumors surfaced in July that Altice USA was negotiating a deal that could have been valued at as much as $20 billion. Altice’s then-CEO Dexter Goei confirmed in August it was indeed in talks with interested parties who had approached the company. He indicated at the time that it made sense to weigh a sale before the operator begins ramping fiber rollouts across its Suddenlink territory in 2023.

Though Goei never revealed who exactly it was negotiating with, analysts at MoffettNathanson pointed to Cable One and Cox Communications as potential buyers, with private equity firms the wild card.

But ultimately, “they obviously didn’t get an offer at a price they considered adequate,” New Street Research wrote in a note to investors following Altice’s announcement this week.

The firm added “we thought a sale of Suddenlink would pave the way for management taking the Altice private…the catalyst we were looking for failed to transpire.”

Altice’s decision comes shortly after new CEO Dennis Mathew took over from Goei in early October. During Q3 2022 earnings, Mathew highlighted the need for the company to implement more disciplined execution and improve both its internal processes and the customer experience.