Altice's appetite for M&A in the ever-changing US cable market just got even bigger. Only a few months after agreeing to pay $9.1 billion for a 70% stake in Suddenlink, the group controlled by French-Israeli billionaire Patrick Drahi has announced plans to buy Cablevision for a whopping $17.7 billion. (See Altice to Buy Suddenlink in $9.1B Deal.)

Ownership of both Suddenlink Communications and Cablevision Systems Corp. (NYSE: CVC) will make Altice the fourth-biggest cable operator in the US market, serving about 4.6 million customers across 20 US states.

Confirmation of the deal followed earlier reports that Drahi had a hungry eye on Cablevision, whose scale and service portfolio would put Altice in a much stronger position to challenge cable giants Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Charter Communications Inc. should regulators ultimately approve the latter's $78.7 billion takeover of Time Warner Cable Inc. (NYSE: TWC). (See Altice Close on Cablevision Deal – Report and Altice Eyes Next US Cable Prizes.)

It also comes after James Dolan, the CEO of Cablevision, suggested he would be open to a sale of his business during a presentation at the Internet & Television Expo event in May. (See Cablevision Chief Plays the Dating Game.)

Passing around 5 million premises, Cablevision currently serves about 3.1 million customers and claims that nearly two thirds of these subscribe to triple-play offerings comprising voice, broadband and TV services.

Cablevision also owns News 12 Networks, a 24-hour local news channel catering to the New York area, as well as the Newsday Media Group, a business services unit called Lightpath and an advertising sales division called Cablevision Media Sales.

But Altice is to pay a high price for the business. The cash offer of $34.90 per Cablevision share is substantially more than Cablevision's closing share price of $28.54 on September 16.

Fuelled by merger speculation, Cablevision's share price has risen by nearly 20% during the past three months.

The leading cable operator in the New York metropolitan area, Cablevision made revenues of about $6.46 billion last year, 3.7% more than in 2013, and saw its operating profit rise by 32% over the same period, to $921 million.

At this stage, Altice says it not planning to merge Suddenlink and Cablevision, but it reckons they will be able to benefit from each other's management expertise as well as the international capabilities of the Altice group.

"We will be in a stronger position, as in all other markets in which we operate, to deliver the best services, invest in the most advanced technology, and develop innovative products for the benefit of our customers," said Drahi in a company statement.

Altice said it would finance the transaction through about $7 billion of fresh debt plus $3.3 billion in cash and the move will increase Cablevision's net debts to approximately $14.5 billion from a figure of $7.7 billion in June. Drahi is hopeful of finalizing the deal -- which is subject to regulatory approvals -- in the first half of 2016.

In its statement on the deal, Altice also indicated that BC Partners and CPP Investment Board -- which will together retain a 30% stake in Suddenlink following the conclusion of that deal -- will have an option to purchase up to 30% of Cablevision's equity.

Altice has emerged as one of the most acquisitive players in the global communications market in the past couple of years, snapping up major telecom businesses in France and Portugal besides Suddenlink.

However, the company has also had its share of disappointments, losing out to Charter in a battle for Time Warner Cable and failing to acquire France's Bouygues Telecom earlier this year due to opposition from the Bouygues board of directors. (See Charter Seals Deals for TWC, Bright House and Bouygues Says 'Non' to Altice.)

In June, Altice set up a new Dutch entity in a financial restructuring designed to support future takeover activity. The Dutch entity's dual-class share structure means Drahi can use equity to support M&A activities without weakening his voting rights. (See Altice Restructures to Support Takeover Moves.)

As regards the Cablevision deal, Altice plans to raise equity for the $3.3 billion it needs in cash by issuing so-called Class A shares.

— Iain Morris, , News Editor, Light Reading