The separation will be effected via a distribution in kind by Altice NV of its 67.2%
interest in Altice USA (5.3 million shares of Class A Common Stock and 490.1 million shares
of Class B Common Stock) to its shareholders (the “Distribution”). Each Altice NV
shareholder will be given the opportunity to receive only shares of Class A Common Stock,
Class B Common Stock or a combination thereof. The Distribution will take place out of Altice
NV’s share premium reserve. The Distribution will have no tax impact on Altice NV or Altice
USA, and is not expected to be subject to withholding tax in the Netherlands. Altice NV
shareholders that are US taxpayers will be subject to US income tax on the distribution.
Each Altice NV shareholder, irrespective of whether it owns A- or B-shares in Altice
NV, will be entitled to receive 0.4163 of a share of Altice USA Common Stock for every Altice
NV share (no distribution of Altice USA Common Stock will be made with respect to any
Altice NV Treasury Shares). The Class A Common Stock of Altice USA is listed for trading
on the New York Stock Exchange (Ticker: ATUS). The Class B Common Stock of Altice USA
will not be listed for trading on the New York Stock Exchange or any other exchange at the
time of the separation and is not currently expected to be listed for trading on any exchange
in the future. Each share of Altice USA Class B Common Stock is convertible into one share
of Altice USA Class A Common Stock.
Shares of Altice USA Class A Common Stock and Class B Common Stock mirror
Altice NV’s capital structure: equal economics, shares of Altice USA Class A Common Stock
are entitled to one vote per share and shares of Altice USA Class B Common Stock are
entitled to 25 votes per share. Next, together with parties in concert with Next in Altice NV
(together the “ANV Next Concert”), will elect to receive only Class B Common Stock pro rata
for their ownership of Altice NV (52.2% economic stake
3
). The total number of Class B
Common Stock to be distributed will be capped at 247.7m or 50% of the Altice USA shares
currently owned by Altice NV
4
, representing c. 34% of the total outstanding shares of Altice
USA. If final demand exceeds the cap on the Class B Common Stock, shares of Class B
Common Stock requested by shareholders will be proportionately reduced and replaced with
a corresponding amount of Class A Common Stock.
The transaction will increase the economic ownership of public stockholders of Altice
USA from 10.3% of the total share capital of Altice USA to 42.4%. Assuming 100% of Altice
NV public shareholders elect to receive Altice USA Class B Common Stock, the voting
percentage of the Altice USA public stockholders will increase from 0.6% to 47.2% and the
ATUS Next Concert will have 51.2% of the voting power. Assuming 0% of Altice NV public
3
Including shares owned directly and indirectly by Patrick Drahi through Next and shares owned by ANV shareholders
subject to shareholders’ agreements with Next (as per section 3.7.6 of Altice N.V. 2016 Annual Report).
4
Excluding shares indirectly owned by Altice NV through Holding LP.
4
shareholders elect to receive Altice USA Class B Common Stock, the voting power of the
Altice USA public stockholders will increase from 0.6% to 4.7% and the ATUS Next Concert
will have 93.7% of the voting power.
The separation will require the publication of formal documentation in Europe and an
effective registration statement on file with the U.S. Securities & Exchange Commission
(SEC) in the US and require US regulatory approvals. An EU prospectus is to be filed with
the Dutch Authority for the Financial Markets (AFM) for review and approval. Altice USA has
filed a Registration Statement on Form S-1 with respect to the separation with the SEC. Upon
approval from the AFM and notification for passporting in relevant Member States of the EU,
and declaration by the SEC of the effectiveness of the Registration Statement on Form S-1,
the EU prospectus will be made available on the website of Altice NV.
The separation was approved by the Altice NV Board of Directors on January 8, 2017,
and is subject to Altice NV shareholder approval. An EGM is expected to be held in Q2 2018.
The separation will be effected by the distribution in kind of Altice USA shares to shareholders
of Altice NV, which is expected to occur in Q2 2018 post EGM approval.
Altice NV may at any time and from time to time until the Distribution decide to
abandon or modify the Distribution, including by accelerating or delaying the timing of the
consummation of all or part of the Distribution or modifying or changing the terms of the
Distribution if, at any time, the Altice NV board of directors determines, in its sole and
absolute discretion, that the Distribution is not in the best interests of Altice NV or its
shareholders or is otherwise not advisable. Certain changes to the Distribution would require
approval of Altice USA’s independent directors.