Altice is to spin off its US operation and restructure its European and pay TV assets in a major reorganisation that saw its share price rise sharply. Company founder Patrick Drahi will take direct control of both European and US operations.Altice is to separate Altice USA from the parent company by spinning off its 67.2% stake in the company. Altice will be split into two separate companies – Altice USA and the renamed Altice Europe. Altice said that the move would enable each business to focus more on the distinct opportunities for value creation in their respective markets and ensure greater transparency for investorsThe company plans to complete the change by the end of Q2, pending regulatory and shareholder approval.The US spin-off will be completed through a distribution in kind to Altice shareholders. Following the split Patrick Drahi will retain control of both companies through his Next investment vehicle. Drahi will also serve as president of Altice Europe and chairman of Altice USA.Altice Europe will be reorganised into three new units – Altice France, which will look after French and French overseas assets, notably SFR; Altice international; and a new Altice Pay TV subsidiary. The creation of the latter will see Altice Europe’s premium content activities bundled into a separately funded unit with its own P&L.Patrick Drahi“The separation will allow both Altice Europe and Altice USA to focus on their respective operations and execute against their strategies, deliver value for shareholders, and realise their full potential. Both operations will have the fundamental Altice Model at their heart through my close personal involvement as well as that of the historic founding team,” said Drahi.Drahi said that Altice Europe would focus on turning around the operational and financial performance of its French and Portuguese units and on the sale of non-core assets.Dennis Okhuijsen will serve as CEO and a director of Altice Europe, reporting to Drahi. Armando Pereira, a close collaborator of Drahi, will serve as COO of Altice Europe and serve as strategic advisor to Altice USA for all operations.The new pay TV unit will include the Altice content division, major sports rights and other premium content rights. Altice France will cancel its existing wholesale pay TV contracts for the content and channels being transferred to Altice Pay TV and will become a wholesale customer of Altice Pay TV with a new revenue sharing contract and what the company described as a “significantly reduced annual minimum guarantee”. Altice France will pay about €300 million to Altice Pay TV as a “break fee”.This move is designed to assuage investor concerns about the impact of Altice’s investment in premium content on the underlying network business. Altice said that the move would enable investors to better assess Altice France’s performance against its competitors. The change is expected to give a significant boost to Altice France’s free cash flow.Altice USA’s independent directors have meanwhile approved a US$1.5 billion (€1.25 billion) cash dividend for shareholders prior to completion of the spin off. Altice will receive €900 million of this, €625 million of which will be used to repay debt, with €275 million to remain on the balance sheet.Dexter Goei will continue to serve as CEO and a Director of Altice USA, also reporting to Drahi as chairman.Altice’s shares jumped by 10% on the news after a period in which the troubled telecom group’s stock lost about half its value, following its unveiling of poor Q3 results at the end of November.