French-Israeli billionaire Patrick Drahi is expected to publicly address the corruption probe rocking his telecommunications empire for the first time on Monday, following mounting pressure since Portuguese prosecutors announced a criminal investigation last month.
(Bloomberg) — French-Israeli billionaire Patrick Drahi is expected to publicly address the corruption probe rocking his telecommunications empire for the first time on Monday, following mounting pressure since Portuguese prosecutors announced a criminal investigation last month.
Drahi will join a quarterly results call for debt investors of Altice International, the unit that includes Altice Portugal, at noon London time Monday, the company said in a statement. On Tuesday he will join the equivalent call for Altice France.
In a press release ahead of the call, Altice reiterated previous statements that the company was a victim of the alleged wrongdoings and that it had opened its own internal audits in every region in which it operates. It also said it was conducting a “full review and thorough reinforcement of the approval process on all procurement, payments, purchase orders and related processes.”
Altice co-founder and Drahi’s right-hand man, Armando Pereira, is among about a dozen employees and 60 suppliers in Portugal, France and the US to be suspended in relation to allegations of corruption, money laundering and tax fraud and some of Altice’s bonds have been pushed deep into distress. The spreading crisis comes as the group’s debt pile has ballooned to more than $60 billion after years of aggressive acquisitions.
Read more: The Corruption Probe Rocking Altice Tycoon’s Empire: QuickTake
An Altice spokesperson declined to provide details about what Drahi would say ahead of time, but there are questions about his relationship with Pereira, who is currently under house arrest in Portugal, and how the business moves forward amid the growing scandal. Bond investors will be looking for assurances from the company that it can raise cash to pay off its debt, with particular focus on any update on the sale of Altice France’s data centers.
Portuguese prosecutors have said they suspect that procurement decisions taken at Altice Portugal were rigged in a way that harmed the group’s own companies and competitors and benefited intermediaries. A three-year investigation led to 90 searches of homes and offices and several arrests.
Altice International reported total earnings growth of 7.2% year-on-year on a constant currency basis in the second quarter on Monday, with operating free cash flow amounting to €241 million ($265 million). For the full year, the company expects earnings and cash flow to grow “broadly in line” with year-to-date performance.
Drahi and his management team plan to host investor meetings in London and New York in September, the company said.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.