Yahoo Finance Altice USA Replaces Procurement Head on Corruption Probe
(Bloomberg) -- Altice USA has replaced Yossi Benchetrit as its head of procurement as an investigation linked to suspected fraud in the Altice group widens.
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Jennifer Yohe, a 25-year procurement veteran, has been hired to replace Benchetrit, who has been on leave since the beginning of the probe, Chief Executive Officer Dennis Mathew said on a conference call with analysts to discuss quarterly results. The company is also reviewing all supplier and vendor relationships and will pause some capital spending until the probe is complete.
Benchetrit is the son-in-law of Altice co-founder Armando Pereira, who was detained in Portugal on July 13 as part of a criminal investigation into alleged corruption, tax fraud and money laundering.
“We are committed to conducting our business with the highest integrity and will continue to move forward, operating with the best interest of our shareholders, customers and employees,” Mathew said. Altice USA is conducting its own internal investigation in parallel with others in Europe.
Fallout from the three-year investigation is spreading, as more executives in the sprawling telecommunications group are suspended or replaced. Alexandre Fonseca, chairman of Altice USA, stepped down and Altice France suspended Tatiana Agova-Bregou, the head of content, acquisitions and partnerships. About 10 other employees have also been suspended.
Altice’s supply chain has also been thrown into a state of upheaval as the company untangles and reorganizes relationships with vendors of equipment and services, according to people familiar with the situation. Altice has suspended contracts with about 60 suppliers and launched internal audits.
Altice USA, which provides TV, internet and phone service under the Optimum brand in 21 states, was spun off from the former Altice Europe in 2018. Former Morgan Stanley banker Dexter Goei ran the US unit as CEO until he was replaced in October by Mathew. Goei served as chairman of the US business until Fonseca took that title in March. Goei is still a director on the board. Mathew replaced Fonseca last month, adding chairman to his role.
Billionaire Patrick Drahi founded Altice with Pereira and another partner in France in 2002 and expanded it through high-profile acquisitions of companies like French carrier SFR Group SA, and Suddenlink Communications and Cablevision Systems Corp. in the US.
Pereira is the former chief operating officer of Altice Europe. As part of the investigation, he is being held under house arrest in Portugal. Pereira’s lawyer has denied the Portuguese prosecutor’s allegations.
Altice is facing pressure on many fronts. In addition to the potential corruption investigation, the company’s debt has ballooned, while in the US market, its core subscription business is struggling.
Like its larger cable peers, Altice USA is losing ground to competition from wireless companies that are now selling internet access that’s beamed into homes at a lower cost than landline offers.
(Corrects year of Altice USA spinoff, remove references to Altice Europe)
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