Form 4: Altice USA Director and 10% Owner Next Alt S.a.r.l. Sells Shares to Cover Capped Call Obligations

Next Alt S.a.r.l., a significant shareholder of Altice USA, sold 805,227 shares of Class A common stock to cover obligations from capped call transactions.

Summary

• Next Alt S.a.r.l., an entity controlled by Patrick Drahi, a director and 10% owner of Altice USA, sold 805,227 shares of Altice USA Class A common stock on November 14, 2024.
• The sales were executed at three different prices: $23.3164, $24.5, and $25.6836 per share.
• These transactions were related to the expiration of capped call transactions, which required Next Alt to deliver shares to a financial institution.
• The capped calls were part of a larger transaction involving 33,819,573 shares and expire in tranches over a 42-day period.
• Next Alt used the proceeds from the share sales to repay debt incurred when the capped calls were established.
• Patrick Drahi and Next Alt have granted power of attorney to Armelle Koelf to execute these transactions and related filings.

Sentiment

Score: 5

Explanation: The document reflects a routine transaction related to capped calls. While the share sales could put some downward pressure on the stock, it is an expected event and not necessarily indicative of a negative outlook.

Negatives

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

Risks

• Continued sales of shares by Next Alt could put downward pressure on the stock price.
• The complex nature of the capped call transactions may introduce uncertainty for investors.

Future Outlook

The capped call transactions will continue to expire in tranches over the next 42 trading days, potentially leading to further share sales.

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, which is common in publicly traded companies. The use of capped calls is a complex financial strategy that is not uncommon among sophisticated investors.

Comparison to Industry Standards

• The use of capped calls is a relatively common strategy for large shareholders to manage risk and monetize their holdings, similar to strategies used by other large investors in publicly traded companies.
• The disclosure of these transactions through SEC Form 4 filings is standard practice and consistent with regulatory requirements for insider trading and transparency.

Stakeholder Impact

• Shareholders may experience some downward pressure on the stock price due to the share sales.
• The transactions are unlikely to have a direct impact on employees, customers, or suppliers.

Next Steps

• Further tranches of the capped calls will expire over the next 42 trading days.
• Next Alt may continue to sell shares to cover obligations from these expiring capped calls.

Key Dates

Keywords

Altice USA, Next Alt S.a.r.l., Patrick Drahi, Capped Calls, Share Sale, SEC Form 4, Beneficial Ownership, Derivative Securities