Altice USA is in talks to sell digital platform Cheddar News to Los Angeles-based private equity company Regent, CNBC reports.
Reached via email, an Altice USA press rep told Next TV that the No. 4-sized U.S. cable company "doesn't comment on rumors and speculation." But it had already been reported back in July that the MSO had hired Goldman Sachs to explore strategic options for Cheddar News, which Altice USA acquired in 2019 for $200 million.
According to CNBC, Altice USA and Regent are discussing various cashless transaction formats. One, called an “earn out,” wouldn't include any initial cash payments by the private equity firm. Rather, Altice USA would receive payments that could total around $50 million based on certain performance goals being met.
Altice USA has seen its market capitalization drop below $1 billion as its stock price approaches $2 a share vs. an all-time high of nearly $38 back in December 2020. In those halcyon pandemic days, growth in cable broadband — Altice USA's core business —was exploding.
These days, the cable provider is losing broadband customers — nearly 87,000 of them through the first nine months of 2023.
Under CEO Dennis Mathew, who took over for Dexter Goei last year, Altice USA has initiated a turnaround strategy, primarily focused on improved sales execution of existing core connectivity products, while ditching assets that are not core to its business model.
As for Cheddar News, it was founded as a multiplatform-focused digital news provider targeting younger consumers by former BuzzFeed executive Jon Steinberg, who now serves as CEO for Next TV's parent company, Future plc.
Also Read: Goei: Cheddar Buy Not a Signal of More Deals to Come
With content migrating off the pay TV grid and onto newer distribution platforms, notably free ad-supported streaming, Cheddar offered Altice USA an innovative model that would help it evolve its video business.
For its part, however, Altice USA is in now in a position where its focus is entirely on rekindling growth in its core internet connectivity businesses.
