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 805,230 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 805,230 shares of Class A common stock on December 16, 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 existing capped call transactions, which required Next Alt to deliver shares to a financial institution.
• The capped calls are part of a larger set of transactions involving 33,819,573 shares of Altice USA 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.
• Next Alt repaid debt to the financial institution by delivering the shares, which were valued at the prices set forth in the filing.

Sentiment

Score: 5

Explanation: The document is neutral in sentiment as it primarily reports transactions related to existing financial arrangements. The share sales are a result of capped call expirations, which is a known process.

Negatives

• The sale of 805,230 shares by a major shareholder could be perceived negatively by the market.

Risks

• The ongoing expiration of capped calls could lead to further share sales by Next Alt.
• The complex nature of the capped call transactions may introduce uncertainty for investors.

Future Outlook

The document indicates that capped calls will continue to expire in tranches over a 42-day period, which may lead 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 related to the management of derivative positions by a major shareholder, which is not uncommon in publicly traded companies. The use of capped calls is a strategy to manage risk and potential upside in share price movements.

Comparison to Industry Standards

• The use of capped call transactions is a common strategy employed by large shareholders to manage their exposure to stock price fluctuations, similar to strategies used by other major shareholders in comparable companies.
• The reporting of these transactions via SEC Form 4 is standard practice for insiders and large shareholders, ensuring transparency in the market.

Stakeholder Impact

• Shareholders may be concerned about the potential for further share sales by Next Alt.
• The transactions may have a minor impact on the share price due to the volume of shares sold.

Next Steps

• The capped calls will continue to expire in tranches over the next 42 trading days, potentially leading to further share sales.
• The company will likely continue to monitor the impact of these transactions on its share price.

Key Dates

Keywords

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