Altice Europe's Portuguese unit MEO agreed to sell a minority equity stake of 49.99% in Altice Portugal FTTH to Morgan Stanley Infrastructure Partners, for an enterprise value of €4.63 billion.
The equity partnership with the Morgan Stanley-backed fund will make way for the creation of a nationwide fiber wholesaler in Portugal. Following the deal, MEO will sell technical services to Altice Portugal FTTH for the construction, subscriber connection and maintenance of its fiber network.
Meanwhile, Altice Portugal FTTH will sell wholesale services to all operators at the same financial terms.
The transaction is expected to close in the first half of 2020. A payment of about €1.57 billion will be settled in 2020, followed by a €375 million payment in December 2021 and €375 million in December 2026, subject to performance ratchets.
The agreement is expected to give way to significant refinancing transactions in 2020 for Altice Europe and may aid its debt interest reduction, Altice founder Patrick Drahi said.
Lazard Ltd. acted as Altice Europe's sole financial adviser, while Uría Menéndez, Franklin and Ropes & Gray acted as its legal advisers.