Form 4: Altice USA Director and 10% Owner Next Alt S.a.r.l. Executes Share Disposals and Capped Call Transactions

Next Alt S.a.r.l., a significant shareholder and director of Altice USA, executed share disposals and capped call transactions, resulting in a decrease in their direct holdings of Class A common stock.

Summary

• Next Alt S.a.r.l., an indirect holding company controlled by Patrick Drahi, disposed of 268,409 shares of Altice USA Class A common stock at three different prices: $23.3164, $24.5, and $25.6836 per share on December 5, 2024.
• These disposals were related to the exercise and expiration of existing capped call transactions.
• The capped calls, which involved a total of 33,819,573 shares, are automatically exercised upon expiration and require Next Alt to deliver shares to a financial institution counterparty.
• The number of shares delivered depends on the settlement price of the shares relative to the lower and higher strike prices of the capped calls.
• Following these transactions, Next Alt's direct holdings of Class A common stock decreased to 16,314,642 shares.
• Next Alt also holds call options (obligation to sell) on 10,467,990 shares of Class A common stock after these transactions.

Sentiment

Score: 5

Explanation: The document is a neutral disclosure of transactions. While the share disposals might be seen as slightly negative, they are part of a pre-existing capped call arrangement. The sentiment is therefore neutral.

Negatives

• Next Alt S.a.r.l. reduced its direct holdings of Altice USA Class A common stock by selling 805,227 shares in total.
• The transactions were related to the expiration of capped call transactions, which could indicate a hedging strategy rather than a long-term investment view.

Risks

• The expiration of capped calls and the associated share disposals could create downward pressure on the stock price.
• The complex nature of the capped call transactions and their settlement terms could introduce uncertainty for investors.

Future Outlook

The document does not provide any specific forward-looking statements or guidance beyond the details of the transactions.

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 filing is a routine disclosure of transactions by a major shareholder and director, and it does not indicate any broader industry trends or competitive shifts. It is a specific event related to the company's stock and the shareholder's financial strategy.

Comparison to Industry Standards

• Form 4 filings are standard practice for reporting changes in beneficial ownership by company insiders, and this filing is consistent with regulatory requirements.
• The use of capped call transactions is a common hedging strategy employed by large shareholders, and the details of this transaction are not unusual in the context of similar filings by other companies.
• Comparable companies would also have similar filings when directors or major shareholders execute transactions in their stock.

Stakeholder Impact

• The share disposals could potentially have a minor negative impact on the share price in the short term.
• The transactions do not appear to have any direct impact on employees, customers, or suppliers.

Key Dates

Keywords

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