Altice makes €7bn Portugal Telecom bid

Multinational cable and telecommunications company Altice has made a binding, fully-financed offer to purchase the Portuguese assets of Portuguese quad-play telco Portugal Telecom from Oi, the largest telecommunications company in Brazil and South America, both in terms of subscribers and revenues. These assets comprise the existing business of Portugal Telecom outside of Africa and excludes Portugal Telecom’s Rio Forte debt securities, Oi treasury shares and Portugal Telecom financing vehicles.

The offer submitted by Altice values these assets at an enterprise value of €7.025 billion on a cash and debt free basis, which includes a €400 million earn-out related to the future revenue generation of Portugal Telecom and a €400 million earn-out related to the future generation of Operating Free Cash Flow (EBITDA less Capex).

If this offer is accepted, the transaction net of financial debt and other purchase price adjustments would be financed by new debt and existing cash from Altice.

Altice has been looking for acquisitions to increase its presence in Europe. In April, Altice-controlled French cableco Numericable agreed to buy France’s second largest mobile operator SFR from Vivendi.

Altice owns Portuguese cableco Cabovisão and should its bid succeed, would likely seek to merge its operations with Portugal Telecom’s Meo IPTV platform.

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