Patrick Drahi, telco tycoon, faces debt woes and arrest of aide.

Patrick Drahi, telco tycoon, faces debt woes and arrest of aide.

From Debt to Art: The Rise and Challenges of Patrick Drahi

Paris, Aug 7 (ANBLE) – Here are key facts about Patrick Drahi, the French-Israeli telecoms tycoon whose right-hand man is under house arrest in a corruption probe, and who needs to manage the mountain of debt he built his empire on at a time of increasing interest rates.

Patrick Drahi

Patrick Drahi may be a name not widely known, but his telecom empire has left an undeniable mark in various countries, offering him immense wealth and recognition. Born in Morocco, Drahi moved to France at the tender age of 15. He enrolled in the Polytechnique, one of France’s most prestigious higher education institutions, where his entrepreneurial journey would soon begin.

In 2001, Drahi embarked on the creation of Altice, an Amsterdam-based holding company. Fuelled by debt, Altice became a driving force as Drahi started acquiring cable companies across France, Belgium, and Portugal. This series of ambitious acquisitions laid the foundation for a solid telecoms empire, spanning from Israel and the United States to the Dominican Republic.

Drahi’s influence goes beyond telecommunications. Currently residing between Switzerland, the United States, and Israel, he not only controls France’s second-largest telecoms firm, SFR, but also owns the most-watched news channel in the country, BFM TV. Additionally, Drahi holds the majority shares of Portugal’s largest telecoms firm. His financial acumen has garnered praise over the years, solidifying his status as a successful business tycoon.

However, no success story is without its setbacks. In 2017, Drahi experienced a rapid decline in Altice Europe’s shares. Concerns arose when a report indicated that growth in France was unlikely, leading to fears about the company’s ability to manage its staggering debts. In a bid to address investor concerns and improve sustainability, Drahi initiated strategies such as spinning off the U.S. division, restructuring debt, and privatizing the European arm.

By 2023, Altice found itself grappling with a combined debt of approximately $60 billion across its three units: Altice France, Altice International, and Altice USA. Despite this financial burden, Drahi continued his ventures outside the telecom industry. In 2019, he made headlines by acquiring art auction house Sotheby’s in a deal worth $3.7 billion. Furthermore, Drahi purchased a 24.5% stake in BT through his Altice UK vehicle, known as Altice UK, which is owned by Next Alt, Drahi’s private holding and the same entity that controls SFR.

Recently, Altice faced a stumbling block when co-founder Armando Pereira was placed under house arrest in Portugal. An investigation into alleged corruption at the group’s local subsidiary led to Pereira’s detention. While denying any wrongdoing, Pereira’s arrest prompted Altice to launch an internal investigation. Despite these challenges, Drahi himself has remained silent on the matter.

Looking to the future, Drahi recognizes the importance of investor confidence in Altice’s financial stability. To address this, he and select members of his management team, including country CEOs, have scheduled investor meetings in London and New York for September. However, the company’s debt prices continue to face strain, which intensified after Pereira’s detention in July.

Patrick Drahi’s journey from humble beginnings in Morocco to becoming a telecom magnate and art connoisseur is a testament to his vision and determination. While navigating the complex landscape of debt management and maintaining investor trust, Drahi continues to make bold moves in diversifying his portfolio. Only time will tell how he and Altice will overcome their challenges, but one thing is for certain: Drahi’s story is far from over.