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European cable firm Altice to buy Cablevision for $17.7 billion

The deal will create the fourth largest cable provider in the United States.

Cablevision is being acquired in the latest takeover deal in the cable industry. CNET

Cable operator Cablevision is selling itself off to a European cable conglomerate.

In a deal announced on Thursday, European cable company Altice will acquire Cablevision for $34.90 in cash for each Cablevision share. The deal is valued at around $17.7 billion, including debt.

Based in the Netherlands, Altice is a multinational cable and telecommunications company that provides cable TV, broadband Internet, mobile phone services and landline services in France, Switzerland, Portugal, Israel and other countries. But Altice has been expanding into the US. In May, the company announced a $9.1 billion acquisition deal for Suddenlink, a St. Louis-based cable company. The purchase of Cablevision along with ownership of Suddenlink will give Altice a greater presence in the US cable market and create the fourth biggest cable operator in the country.

As more people cut the cord and get their video fix from online services such as Netflix and Hulu, the US cable industry has been undergoing a consolidation, or at least trying to. Last year, Comcast attempted to buy Time Warner Cable but pulled the plug on the deal in April following objections from regulators. Since then, Charter Communications has been trying to take over Time Warner Cable. And in July, AT&T purchased satellite TV provider DirecTV for $48.5 billion.

Cablevision is the top cable provider operator in the New York tristate area (New York, New Jersey and Connecticut) serving more than 5 million households and more than 3.1 million residential and business customers. Around 65 percent of its customers subscribe to Cablevision's triple-play plan, which offers TV, Internet and phone service.

Altice said that Cablevision will benefit from "additional international operational expertise, enhanced scale and further investment support that are at the core of the Altice business model and strategy." Both Cablevision and Suddenlink will draw upon management from both companies, Altice added, "creating a leading communications services and technology group in the US market with 4.6 million customers in 20 states."

The acquisition will also give Altice ownership of Cablevision's Lightpath business unit, its New York-based News 12 Networks operation, the Newsday Media Group and the Cablevision Media sales advertising division.

The deal will be financed with $14.5 billion of new and existing debt at Cablevision, cash on hand at Cablevision and $3.3 billion of cash from Altice, and has already been approved in writing by a majority of Cablevision stockholders. The acquisition is expected to close in the first half of 2016 following all the necessary regulatory approvals.