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 of Altice USA, disposed of 805,227 Class A common shares through the exercise of capped call transactions.

Summary

• Next Alt S.a.r.l., an indirect holding company controlled by Patrick Drahi, disposed of 805,227 shares of Altice USA Class A common stock on November 20, 2024.
• The shares were disposed of through the exercise of existing capped call transactions with a financial institution.
• These capped calls are part of a larger set of transactions covering 33,819,573 shares, expiring in tranches over 42 trading days.
• The shares were delivered to the counterparty to repay debt incurred when the capped calls were established.
• The transactions occurred at prices of $23.3164, $24.5, and $25.6836 per share.
• Following these transactions, Next Alt's direct holdings decreased to 24,366,912 shares.
• Patrick Drahi, a director of Altice USA, is also a reporting person due to his control of Next Alt.

Sentiment

Score: 5

Explanation: The document reflects a planned transaction, not a sign of distress or significant positive news. The sentiment is neutral as it is a routine filing related to pre-existing financial arrangements.

Negatives

• Next Alt S.a.r.l., a major shareholder, reduced its holdings in Altice USA.

Risks

• The ongoing exercise of capped calls could lead to further reductions in Next Alt's holdings.
• The market may react negatively to the continued selling pressure from a major shareholder.

Future Outlook

The capped calls expire in equal tranches over a 42 scheduled trading day period, beginning October 25, 2024, suggesting further transactions are likely.

Management Comments

• 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 a specific instance of a major shareholder adjusting their position, which is not uncommon in the telecommunications and media industry. It is important to monitor similar transactions by other major shareholders in Altice USA and its competitors.

Comparison to Industry Standards

• Share disposals by major shareholders are a common occurrence in publicly traded companies.
• Capped call transactions are a complex financial instrument used by sophisticated investors to manage risk and exposure.
• The size of the transaction, involving over 800,000 shares, is significant but not unusual for a company of Altice USA's size.
• Comparable companies such as Charter Communications and Comcast also see similar transactions by their major shareholders.

Stakeholder Impact

• Shareholders may be concerned about the reduction in holdings by a major shareholder.
• The transactions could put downward pressure on the share price in the short term.

Next Steps

• Monitor future Form 4 filings for further transactions related to the capped calls.
• Track the share price of Altice USA to assess market reaction to these transactions.

Key Dates

Keywords

Altice USA, Next Alt S.a.r.l., Patrick Drahi, capped calls, share disposal, Form 4, beneficial ownership, derivative securities