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U.S. cable giant Altice USA on Sunday evening unveiled a sweetened unsolicited offer for Cogeco, adding cash to seal a deal for the Canadian company’s U.S. unit, Atlantic Broadband, while planning to sell the target company’s Canadian assets to Rogers Communications.
But the controlling shareholder of Cogeco, the Audet family of Montreal, again rejected the bid. Gestion Audem, the family’s holding company, said in a statement that it “has been made aware of the second hostile proposal from Rogers Communications Inc. and Altice USA.”
“As we did on Sept. 2, following the announcement of their first unsolicited proposal, members of the Audet family unanimously reject this further proposal,” said Louis Audet, president of Gestion Audem. “Since this is apparently not registering with Rogers and Altice, we repeat today that this is not a negotiating strategy, but a definitive refusal. We are not interested in selling our shares.”
The statement added: “The stewardship the Audet family has provided to the corporations over the last 63 years has allowed the corporations to grow and prosper. Today, Cogeco enjoys a unique and enviable position as the only broadband services company with a significant presence in both Canada and the United States. Furthermore, the evolution of the stock prices and operating results of the Cogeco companies far outperforms those of either Rogers or Altice.”
Gestion Audem holds 69 percent of the voting rights of Cogeco Inc., which in turn controls 82.9 percent of all voting rights of Cogeco Communications.
Altice USA had said late Sunday that it was offering to pay $3.96 billion (CAN$5.2 billion) for Cogeco’s Canadian assets and set a deadline of Nov. 18 to complete a takeover deal. The original offer had Altice USA proposing to pay $3.6 billion for the U.S. unit.
“If Altice USA is unable to arrive at a mutually satisfactory agreement by Nov. 18, or, at the very least, it does not see a clear path forward to completion of a transaction, this revised offer will be withdrawn,” the U.S. cable company had said on Sunday.
Altice USA had in early September unveiled its original $7.8 billion takeover bid for Cogeco with Canadian partner Rogers, which owns a 41 percent stake in Cogeco.
Atlantic Broadband is the ninth-largest U.S. cable operator with assets in Connecticut, Delaware, Florida, Maine, Maryland, New Hampshire, New York, Pennsylvania, South Carolina, Virginia and West Virginia.
“We are pleased to present an incredibly attractive revised and enhanced offer for Cogeco that significantly rewards all shareholders and incorporates feedback from recent discussions with holders of subordinate voting shares,” said Altice USA CEO Dexter Goei. “We encourage the Cogeco boards to act in the best interest of all shareholders and stakeholders as they thoughtfully consider this offer, and we respectfully request that the boards engage with us to discuss our proposal.”
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