Telecoms and cable group Altice Europe on Friday said its French unit had agreed to sell a 49.99 percent stake in its SFR FTTH fibre optic business to three investment funds for 1.8 billion euros (US$2.05 billion), sending its shares soaring.
The Amsterdam-listed company stock rose more than 12 percent in early trading.
Allianz Capital Partners, AXA Investment Managers and OMERS Infrastructure were investing in the unit, Altice said, in a deal that valued the division as a whole at 3.6 billion euros.
The telecoms group, owned by billionaire Patrick Drahi, is striving to regain market confidence after a steep fall in its share price a year ago heightened concerns about its ability to repay its 30 billion euros (US$34 billion) of debt.
Altice has already raised some 4 billion euros in cash this year through sales of stakes in its telecoms towers businesses in France and Portugal to help reduce the debt pile.
“Through these transactions, Altice France and Altice Europe will deleverage and will have access to new and cheaper liquidity to invest in its fibre infrastructure,” Drahi said in a statement.
The company reported earlier this month a sharp increase in customers in France in the third quarter, thanks to heavy promotions, and said it expects to return to growth next year.
Update: The consortium was led by OMERS Infrastructure, the infrastructure investment arm of the Ontario Municipal Employees Retirement System (OMERS).
In a statement, Philippe Busslinger, head of Europe at OMERS Infrastructure, said OMERS partnership with Altice France “marks our entry into the attractive telecommunications sector and in the French market.”
Earlier this month, Reuters reported several groups were bidding for the Altice France fibre network business, including one led by KKR.
(Reporting by Sarah White ; Editing by Matthias Blamont and Richard Lough)
(This story has been edited by Kirk Falconer, editor of PE HUB Canada)