News that a French mobile operator is replacing its chief information officer might normally merit a brief note in the appointments pages, but this switch in roles has taken place at SFR or Altice France, part of the Altice Group that has been experiencing months of turmoil owing to high levels of debt and a scandal in Portugal.
According to Bloomberg, which cited an internal message by Altice France chief executive Arthur Dreyfuss and SFR head Mathieu Cocq, current CIO Grégory Quéré has “decided to take his career in another direction.” He is being replaced by Jean-Pierre Large, a transition manager from payment technology company Ingenico.
Quéré is also the second senior Altice executive to leave the group this year. Last week saw the departure of Alexandre Fonseca, the co-CEO of Altice Group who led Altice Portugal from November 2017 to April 2022. He was also briefly chairman of Altice USA as well as the Portuguese operations.
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Last year, Fonseca suspended himself from all duties at the group following an investigation into alleged corruption at its Portuguese subsidiary. Fonseca was not considered a suspect in the investigation.
However, Armando Pereira, who founded Altice together with Patrick Drahi, was placed under house arrest from July to October 2023 as Portuguese prosecutors investigated the allegations.
As reported by Reuters, Altice subsequently suspended about 15 employees as a result of the investigation, which focuses on alleged efforts to rig the group’s local procurement process and is expected to take years to resolve.
In a November 2023 statement, Altice International, the home of Altice Portugal (or MEO), and Altice France said they were on track to transition away from all suppliers potentially implicated in the Portuguese authorities’ investigation by the end of 2023.
Altice International had previously noted that the potentially implicated suppliers accounted for less than 6% of its total expenditures, mainly in Portugal, and pointed out that Altice Portugal has been identified as a victim in this case. Altice France said less than 2% of its total expenditures was affected.
In August, Drahi told investors he felt “shocked” and “betrayed” by the probe in Portugal.
Heavy burden
Amid the corruption scandal and management shuffles, Altice is reeling under a close to $60 billion debt burden that Drahi has pledged to cut through sales of assets, a process not helped by the Portuguese investigation.
The debt is spread across three entities, all controlled by Drahi: Altice International, with net debt of €8.6 billion ($9.7 billion) at the end of September; Altice France, with net debt of €24 billion ($26 billion); and listed unit Altice USA, with net debt of $23 billion.
As noted by Reuters last year, parts of the debt will soon have to be refinanced and maturities extended in the context of rising interest rates.
As things stand, Altice Portugal is said to be up for sale with an estimated price tag of €6 billion to €7 billion. Interest in buying the operator has reportedly come from private equity company Warburg Pincus, Xavier Niel, the owner of Altice France rival Iliad, and Saudi Arabia’s stc Group. Meanwhile, reports suggest Drahi may sell Altice International’s advertising business, said to be worth around €1.5 billion.
According to Bloomberg, Drahi is also soliciting offers for a minority stake in Altice France, which competes with Orange France, Bouygues Telecom, and Iliad’s Free.
As things stand, Altice France has spun off data center assets into a separate company and agreed to sell a 70% stake in the entity to Morgan Stanley Infrastructure Partners for €535 million.
Notably, while Drahi is seeking to raise cash from sales, he still increased Altice’s stake in BT to almost 25% last year and is reportedly keen to buy more shares in the U.K. operator.
In terms of the group’s management structure, Patrick Drahi remains in overall control, with individual CEOs running the three entities. Ana Figueiredo was appointed CEO of Altice Portugal in April 2022 and Altice USA is led by CEO Dennis Mathew.
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Malo Corbin is chief financial officer at Altice Group while David Drahi, Patrick Drahi’s son, is in charge of technologies and development at Altice Group and a director at Altice USA. Both Corbin and David Drahi are also said to be co-CEOs of Altice Group.