DealBook: Group Led by BC Partners to Buy Suddenlink for $1.9 Billion

8:16 a.m. | Updated

LONDON – The private equity firm BC Partners and one of Canada’s largest pension funds have agreed to buy the American cable operator Suddenlink Communications in a cash-and-debt deal worth around $6.6 billion.

BC Partners, which has offices in Europe and New York, and the Canada Pension Plan Investment Board said late on Wednesday that they were teaming up with Suddenlink’s management team, led by the chief executive, Jerald L. Kent, to buy the cable company from its current owners, which include Goldman Sachs Capital Partners, the Quadrangle Group and Oaktree Capital Management.

The private equity firm and Canadian pension fund will provide around a combined $2 billion for the deal and assume Suddenlink’s $4 billion of existing net debt, according to a company statement. The firms also will issue an additional $500 million of unsecured loans provided by Credit Suisse

With Western economies continuing to languish, the cable industry has been a bright spot, as companies look to take advantage of consumer demand for high-speed Internet and television services.

Earlier this year, the Dutch cable operator Ziggo raised around $1 billion in an initial public offering, while the Canadian company Cogeco Cable agreed on Wednesday to pay $1.36 billion for an American company, Atlantic Broadband.

“Cable is an industry we know well in both Europe and the United States, and epitomizes the defensive growth characteristics we typically seek in an investment,” BC Partners’ managing partner, Raymond Svider, said in a statement.

Suddenlink, the seventh-largest cable operator in the United States, provides television, phone and Internet services for about 1.4 million customers from North Carolina to Texas. The company reported revenue of $1.96 billion and a pretax profit of $743 million in the 12 months ended March 31, according to a company statement.

The deal is expected to close by the end of the year.

LionTree Advisors, Goldman Sachs and the law firms Paul Hastings and Seyfarth Shaw advised Suddenlink on the deal, while Credit Suisse and the law firms Latham & Watkins and Wachtell, Lipton, Rosen & Katz advised BC Partners and the Canada Pension Plan Investment Board.