The $6.6 billion valuation is 8.6 times the company’s EBITDA and includes $1.985 billion in equity to be invested by BC Partners, CPPIB and certain members of the company’s management, as well as incremental debt of $500 million and assumption of existing net liabilities of $4.094 billion as of March 31 2012.
These proceeds will be used to acquire the ownership of the company from stakeholding investment firms Goldman Sachs Capital Partners, Quadrangle and Oaktree Capital Management.
Suddenlink is the seventh largest cable operator in the US, offering television, high-speed internet and telephony services to over 1.4 million residential and commercial customers in Texas, West Virginia, North Carolina, Oklahoma, Arkansas and Louisiana. The company’s network passes three million homes and is interconnected by a national backbone.
"Cable is an industry we know well in both Europe and the US, and epitomises the defensive growth characteristics we typically seek in an investment," said Raymond Svider, BC Partners co-chairman and managing partner. "Suddenlink is one of the most attractive cable companies in the US today, with a world-class infrastructure and a dedication to providing customers with the very best offering and service. We are excited to be partnering with Jerry Kent and the high quality and experienced management team he has assembled.
As part of the acquisition a newly formed subsidiary of Suddenlink has entered into a commitment letter with Credit Suisse for $500 million on senior unsecured bridge loans, which are expected to fund a portion of the purchase price.
The transaction is expected to close in Q4 2012 subject to customary closing conditions and regulatory approval.
