Activist SFR investor says launches legal action against Altice
by Maiya Keidan and Mathieu Rosemain
Activist hedge fund CIAM said it had filed a complaint in a French court on behalf of minority investors in telecoms company SFR Group over the way majority shareholder Altice has used SFR's assets.
CIAM said its complaint lodged with a criminal court in Paris on Friday referred to the treatment by Altice of an 80 million euro ($89.4 million) antitrust fine, an office move and its plan to ditch the SFR brand.
"We want the court to recognise there has been misuse of the corporate assets to the detriment of minority shareholders," CIAM managing partner and co-founder Anne-Sophie d'Andlau told Reuters.
The court could not be reached for comment outside of business hours.
SFR said it had learnt of the complaint through media reports and that it has no merit.
"The issues that are allegedly mentioned have been dealt with in accordance with the law, abiding by applicable governance rules," an SFR spokesman told Reuters.
Altice, which owns 91 percent of SFR shares, declined to comment.
CIAM owns less than one percent of SFR shares. Activists often take a relatively small stake in the company to give them a platform to argue for change.
French antitrust officials imposed a fine last year after it said Altice's Numericable business had taken control of SFR before the deal had been cleared by competition authorities.
CIAM said the fine should have been split equally between SFR and Altice and argued that Altice did not pay enough towards the bill.
CIAM also cited a decision to give up a 12-year lease on an SFR office building early in favour of a move to a more expensive office in Paris owned by French billionaire and Altice founder Patrick Drahi through a holding company.
The move, to be completed by the middle of next year and designed to put all Altice and SFR activities under one roof, would see the rental payments jump from 490 euros per square metre per year to 725 euros per square metre per year, CIAM said.
The hedge fund also said it objected to a planned substitution of the SFR brand for the "unknown" Altice brand, which will involve SFR paying an unspecified amount of money to Altice for the use of the brand.
The move to rebrand was announced in May and will see SFR and other recent Altice acquisitions, including Portugal Telecom and U.S. cable operators Cablevision and Suddenlink under one unified brand.