UPDATE 2-Europe's Altice to spin off U.S. operation, simplify business

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Jan 8 (Reuters) - Telecoms and cable group Altice NV , which is trying to cut debts of around 50 billion euros ($59 billion), said on Monday its board has approved plans to spin-off its U.S. unit from its European operation.

The move is intended to simplify a sprawling communications empire that executives said encompassed two distinct markets, the United States and Europe.

Altices performance in Europe last year led investors to question its strategy, and in November founder Patrick Drahi returned as president while Chief Executive Michel Combes resigned.

"Altice USA's shares have suffered from guilt by association with the weaker results at the European parent," Craig Moffett, an analyst at MoffettNathanson, said in an email.

"The biggest overhang on Altice USA shares," he added, "has been the nagging concern that U.S. shareholders might somehow be called upon to backstop weakness in Europe. That risk will now be gone."

Netherlands-based Altice NV, which will be renamed Altice Europe, said it aims to complete the spinoff of its 67.2 percent interest in Altice USA by the end of the second quarter of 2018, following regulatory and shareholder approvals.

Altice has grown in the United States and Europe through debt-fueled acquisitions, raising its net debt to more than five times its annual core operating profit.

The two companies will be led by separate management teams with Drahi retaining control of both companies.

Dennis Okhuijsen will become CEO of Altice Europe and Dexter Goei will serve as CEO of Altice USA.

Franco-Israeli tycoon Drahi is the group's controlling shareholder with a 31.1 percent stake, according to Thomson Reuters data.

Altice USA on Monday also approved in principle a cash dividend of $1.5 billion to all shareholders immediately prior to completion of the separation, funded by debt. It also approved a $2 billion repurchase program of U.S. shares, once the separation is complete.

(Reporting by Sonam Rai and Supantha Mukherjee in Bengaluru; editing by Peter Henderson; Editing by Maju Samuel)