Vodafone Deal Is a Bad Sign for Altice France, Analyst Says
- Drahi has promised to sell assets to reduce debt load
- Altice aims to cut leverage to around five times earnings
The deal is being valued at €5 billion including debt, which corresponds to a multiple of 5.3 times adjusted earnings after leases.
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Vodafone Group Plc’s sale of its Spanish business should be a “reality check” for Patrick Drahi’s plan to sell part of his business empire, according to Bloomberg Intelligence analyst Aidan Cheslin.
The deal is being valued at €5 billion ($5.3 billion) including debt, which corresponds to a multiple of 5.3 times adjusted earnings after leases. At that level, it implies that Altice France, one of the divisions of the Drahi’s telecommunications business, would have zero or negative equity value, given that it already has a 5.8 times leverage, wrote Cheslin in a note.