Altice USA Inc (NYSE: ATUS) is having an overwhelmingly strong day in the market today, and for good reason. The company announced spinoff plans that led to excitement among investors, sending the stock soaring. Today, we’ll talk about the plans, what we’re seeing from ATUS, and what we’ll be watching for ahead.
ATUS Gains On Spinoff Plans
As mentioned above, Altice USA is having an overwhelmingly strong day in the market today after the company’s parent company, Altice N.V., announced a spinoff. The company announced that its Board of Directors has approved plans for the separation of Altice USA Inc. from Altice NV.
In the PR, ATUS said that the spinoff will give each business a better opportunity to focus more on the distinct opportunities in their respective markets. The move also increases transparency for investors. In the release, the company said that the spinoff is planned to be completed by the end of the second quarter of 2018. Of course, the move is still subject to regulatory and shareholder approvals. In a statement, Patrick Drahi, founder of ATUS, had the following to offer:
“The separation will allow both Altice Europe and Altice USA to focus on their respective operations and execute against their strategies, deliver value for shareholders, and realize their full potential. Both operations will have the fundamental Altice Model at their heart through my close personal involvement as well as that of the historic founding team.
Altice Europe has tremendous opportunities as we deliver on our operation aspirations around much improved customer service and monetizing our premium infrastructure and content assets. Altice Europe has a unique asset base that is fully converged and fiber rich with strong number one or number two positions in each market with nationwide fixed and mobile coverage. At the core of our strategy is the operation and financial turnaround in France and Portugal. In parallel, we have a clear plan to further strengthen our long-term balance sheet position as we execute our non-core asset disposals.
Altice USA sees exciting opportunities in the US market as we start 2018 with strong momentum. We have a full operational agenda to deliver best-in-class services to our customers, drive innovation and advance our fiber investment strategy. The new organization structure will enable us to focus even more on executing this agenda while enhancing transparency for our investors. We remain confident in achieving the objectives we set out at the beginning of our journey in the US and affirm the efficiency targets set out at the time of the acquisitions of Suddenlink and Optimum.”
What We’re Seeing From The Stock As A Result
One of the first things that we learn when we start to dabble in the market is that the news causes movement. In this particular case, investors are loving the idea of the spinoff, which can be seen through the gains in the value of the stock. Of course, our partners at Trade Ideas were the first to alert us to the gains. At the moment (11:12), ATUS is trading at $24.19 per share after a gain of $3.10 per share or 14.70% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on ATUS. In particular, we’re interested in following the story surrounding the spinoff as it is still subject to regulatory and shareholder approval. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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