New York PSC Signs Off on Altice/Cablevision
Altice won final regulatory OK for its $17.7 billion takeover of Cablevision. At a public meeting Wednesday, the New York Public Service Commission voted 4-0 to greenlight the deal with conditions. The order furthers Democratic Gov. Andrew Cuomo’s goal of spreading first-class broadband across the state, said Chairwoman Audrey Zibelman. Conditions tracked with recommendations released last month by advisory staff for the Department of Public Service (DPS), focusing on network investment, internet speed enhancements, access, affordability, debt risk mitigation and service quality (see 1605200070).
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Altice was "pleased” with the decision, it said in a statement. “This follows approvals received from the Federal Communications Commission, the Department of Justice, the New Jersey Board of Public Utilities and 67 local municipalities. We remain on track to closing the transaction as expected.” Altice has said the deal would close in Q2.
The PSC “considered carefully Cablevision’s financial condition post-transaction and find[s] that efficiency opportunities should enable the Company to manage its increased debt,” the order said. “Further, the presence of competition and the conditions the Commission is requiring should assure that Cablevision continues to promote service quality and network modernization.” It said the deal “is in the public interest provided that the Petitioners agree to make concrete and enforceable commitments to enhance and expand access to Cablevision’s communications systems and services, address the digital divide, maintain adequate customer service, and ameliorate constraints that result from the size of the debt incurred to finance the acquisition.”
Strong conditions on debt risk mitigation and service quality will ensure the combined company is financially viable and meets customer needs, Zibelman said at the meeting. As the U.S. Court of Appeals for the D.C. Circuit ruled Tuesday (see 1606140012), the chairwoman said, cable and broadband are utilities and essential services. Under the order, the company will be required to report quarterly to DPS and invest up to $16 million yearly on service quality if it doesn’t meet service metric standards. Also, Zibelman applauded conditions related to emergency response, noting devastation from Superstorm Sandy.
Enforcement will be critical, GOP Commissioner Patricia Acampora said. She saw more negatives than positives when the acquisition was first proposed, but PSC staff turned around an acceptable order, she said. “This is as good as we can do right now. … I will vote in favor of this, but I do caution Altice: Know your customer base and don’t take advantage of it, because we’ll be watching.”
“I’m convinced that this proposal is good for New York’s consumers and is an improvement over the status quo,” said Commissioner Gregg Sayre. “Network improvements, speed improvements, stand-alone low-priced service, a low-income program, storm resilience, job protections, service quality protections, free service to anchor institutions, and STEM [science, technology, engineering and math] student and job training support. It’s an amazing list.” The conditions address the nonpartisan commissioner’s concerns about the company’s debt, he said.
Union officials initially raised concerns about the deal, but later supported a conditional OK (see 1605310044). “We are pleased that the Altice/Cablevision deal has been approved by the commission,” said Bob Master, Communications Workers of America legislative and political director-district one.
New York City qualified its approval last month on employment and other conditions making the final state order (see 1605110055). The office of Mayor Bill de Blasio (D) didn’t immediately comment.
The FCC last month OK’d Altice/Cablevision without conditions other than those for national security (see 1605040010), leaving the New York PSC with "all the hard issues to resolve," noted Zibelman. “I wish they would do that … on the rest of the issues. I think our lives would be a lot easier.”