Cloud 9fin Control, Altice, Delete
Apr 4, 2024
In this podcast, they discuss Altice France's massive capacity to designate subsidiaries as unrestricted, unique debt reduction strategies, complexities in insolvency scenarios, and potential pitfalls for management and investors. They also explore interplay within Altis entities, strategic management tactics, restructuring dynamics in French insolvency processes, and non-consensual financial processes for negotiation facilitation.
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Unrestricted Subsidiaries
- Altice has significant capacity to designate more subsidiaries as unrestricted, like they did with Altice Media.
- This allows them flexibility for dividends, asset sales outside of covenants, and potential up-tiering transactions.
Bondholder Protection
- Bondholders have limited protection regarding dividends and distributions under French law.
- Directors' duties and antecedent transaction risks are key considerations but don't offer certain guardrails.
Creditors' Dilemma
- Drahi's expectation for creditors to take haircuts while preserving his equity stake creates tension.
- Unsecured creditors face a dilemma: accept a massive haircut or risk getting nothing if Drahi extracts more value.