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, disposed of 805,227 Class A common shares 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 Class A common shares.
• 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 covered a total of 33,819,573 shares.
• The capped calls expire in equal tranches over a 42-day period, beginning October 25, 2024, and are automatically exercised upon expiration.
• The transactions occurred on November 15, 2024, with shares sold at prices of $23.3164, $24.5, and $25.6836 per share.
• Next Alt repaid debt to the financial institution by delivering the shares, which were valued at the prices set forth in the table.

Sentiment

Score: 5

Explanation: The document is neutral in sentiment, detailing a planned transaction. While the sale of shares could be seen as negative, it is part of a pre-existing agreement.

Negatives

• The sale of shares by a major shareholder could be perceived negatively by the market.

Risks

• The expiration of the capped calls could lead to further share sales by Next Alt.
• The market may react negatively to the continued reduction in Next Alt's holdings.

Future Outlook

The capped calls expire in equal tranches over a 42 scheduled trading day period, beginning October 25, 2024, and are automatically exercised upon expiration, which may lead to further share disposals.

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

The use of capped call transactions is a common strategy for large shareholders to manage their risk and exposure, but can also signal a change in their investment outlook.

Comparison to Industry Standards

• Capped call transactions are a common hedging strategy used by large shareholders in various industries, including telecommunications.
• Similar transactions have been observed with other companies where major shareholders seek to manage their exposure while potentially monetizing their holdings.
• The size of the transaction, involving over 33 million shares, is significant and indicates a substantial position being managed.

Stakeholder Impact

• Shareholders may react to the share disposals by Next Alt, potentially impacting the stock price.
• The transactions could affect the overall market perception of Altice USA.

Next Steps

• The remaining capped calls will continue to expire over the 42-day period, potentially leading to further share disposals.
• The market will likely monitor the impact of these transactions on the share price.

Key Dates

Keywords

Altice USA, Next Alt S.a.r.l., Patrick Drahi, capped calls, share disposal, Class A common stock, derivative securities, shareholder, director