Altice USA sets $310M deal for Morris Broadband

NEW YORK – Altice USA (NYSE: ATUS) today announced it has entered into a definitive agreement to acquire the assets of Morris Broadband, LLC (“Morris Broadband”). The transaction will expand Altice USA's footprint in North Carolina, where it already has a presence with its Suddenlink business, and implies an enterprise value of $310 million total for the Morris Broadband business on a debt-free and cash-free basis. Following this acquisition, North Carolina will represent the sixth largest state for Altice USA out of its 21 states of operations in terms of number of residential customers, demonstrating the Company's commitment to invest heavily in the region with additional resources and network investments.

Morris Broadband is a rapidly growing broadband communications services company providing high-speed data, video and voice services to approximately 36,500 residential and business customers in western North Carolina. As of December 31, 2020, Morris Broadband passed approximately 89,000 homes throughout growing communities including Hendersonville, Franklin, Sylva, Nebo and West Jefferson with broadband penetration of approximately 35%.

As part of Altice USA, Morris Broadband will benefit from enhanced scale, operating efficiencies and further investment support that are at the core of the Altice business model and strategy, including accelerated new homes build. Altice USA's commitment to innovation, best-in-class services, long-term network investments and customer service creates significant benefits and long-term value for customers, employees and shareholders.

Morris Broadband generated approximately $13 million in Adjusted EBITDA on an annualized basis for the quarter ended December 31, 2020 (“Q4 LQA”). The purchase price represents a multiple of Morris Broadband's Q4 LQA Adjusted EBITDA of approximately 24.1x before taking into account estimated run-rate synergies. Including the estimated run-rate synergies that Altice USA expects to realize in full within two years of closing the transaction and adjusting for the present value of anticipated tax benefits, the purchase price represents a multiple of projected 2022 Adjusted EBITDA of 7.4x.

Altice USA intends to finance the transaction with available liquidity. The transaction is subject to certain regulatory approvals and other customary closing conditions and is expected to be completed in the second quarter of 2021.

Moorgate Securities acted as financial advisor to Morris Broadband in connection with this transaction.

Read the full announcement here.

Altice USA