Hot yesterday denied a report that Altice, its parent company, intends to put it up for sale. This denial should not necessarily be taken at face value, given the uncertainty about a deal for sale of the controlling interest in its subsidiary HOT Telecommunication Systems.
In recent weeks it has been reported that Hot had hired the Morgan Stanley investment bank to search for an investor to acquire a controlling interest in HOT Telecom, HOT's landline infrastructure arm. No progress has been made, however, because of the high price set by Altice.
In recent months, "Globes" revealed Altice's plan to bring in an investor for Hot's telecommunications activity in Israel, as it did for its activity in France. Altice set a price of NIS 5 billion or more for HOT Telecom in negotiations.
Altice did not hesitate to offer for sale a 75% controlling interest in HOT Telecom. It cannot be ruled out that Altice will also agree to sell Hot's main cable TV activity, if the price is right.
There are two main reasons that Altice wants to sell HOT Telecom. The first is to reduce Altice's multi-billion-dollar debt. The second is that Hot needs an enormous investment in its fiber-optic network in Israel, which it will have difficulty financing without the help of an investor.
Hot said in response, "The report is incorrect; the company is not for sale."
Published by Globes, Israel business news - en.globes.co.il - on March 3, 2019
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