Form 4: Altice USA Director and 10% Owner, Next Alt S.a.r.l., Disposes of Shares Through Capped Call Transactions

Next Alt S.a.r.l., a significant shareholder and director of Altice USA, Inc., disposed of 805,227 shares of Class A common stock through the exercise of capped call transactions.

Summary

• Next Alt S.a.r.l., an indirect wholly-owned holding company of Patrick Drahi, a director of Altice USA, disposed of 805,227 shares of Altice USA Class A common stock on November 26, 2024.
• The shares were disposed of through the exercise of existing bilateral European capped call transactions.
• These capped calls were with a financial institution counterparty and involved a total of 33,819,573 shares of Class A common stock.
• The capped calls expire in tranches over a 42-day period, starting October 25, 2024, and are automatically exercised upon expiration.
• The shares were delivered to the counterparty to repay debt incurred in connection with the execution of the capped calls.
• The transactions occurred at varying prices of $23.3164, $24.5, and $25.6836 per share.
• Following these transactions, Next Alt's direct holdings of Class A common stock decreased to 21,146,004 shares.
• Next Alt also holds call options (obligation to sell) for 15,299,352 shares after the transactions.

Sentiment

Score: 5

Explanation: The document reflects a planned transaction related to existing financial agreements. It is neither particularly positive nor negative, but rather a routine disclosure of a pre-arranged share disposal.

Negatives

• Next Alt S.a.r.l., a significant shareholder, reduced its holdings in Altice USA through the sale of shares.

Risks

• The continued exercise of capped calls could further reduce Next Alt's holdings in Altice USA.
• The complex nature of the capped call transactions may introduce uncertainty regarding future share movements.

Future Outlook

The document does not provide specific forward-looking statements, but the ongoing expiration of capped calls suggests further share disposals may occur.

Management Comments

• Next Alt S.a.r.l. is an indirect wholly-owned and controlled personal holding company of Patrick Drahi.
• Each Reporting Person disclaims beneficial ownership of all interests reported on this Form 4 except to the extent of such Reporting Person's pecuniary interests.

Industry Context

This transaction is specific to Altice USA and its major shareholder, and does not directly reflect broader industry trends. However, it does highlight the use of complex financial instruments like capped calls by large shareholders.

Comparison to Industry Standards

• Capped call transactions are not uncommon among large shareholders seeking to manage risk and monetize their holdings.
• The specific details of these transactions are unique to the agreement between Next Alt and its counterparty, making direct comparisons difficult.
• Other companies with large shareholders may use similar strategies, but the terms and conditions would vary based on their specific circumstances.

Stakeholder Impact

• The share disposals may have a minor impact on the share price of Altice USA.
• The transactions do not directly impact employees, customers, or suppliers.

Next Steps

• The remaining capped calls will continue to expire over the next 42 trading days, potentially leading to further share disposals.
• Next Alt will continue to report any changes in beneficial ownership as required by SEC regulations.

Key Dates

Keywords

Altice USA, Next Alt S.a.r.l., Patrick Drahi, Capped Calls, Share Disposal, Class A Common Stock, Derivative Securities, SEC Form 4, Shareholder, Director