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By Pierre Bertrand and Mauro Orru
Atos accepted a financial-restructuring proposal from a consortium including key shareholder Onepoint to salvage the debt-laden French IT firm, outgunning a rival bid from a group led by Czech billionaire Daniel Kretinsky.
Atos’s rescue comes after several tumultuous years for a company with contracts in France’s military and nuclear industry that is also the cybersecurity provider for this summer’s Paris Olympics.
The company, which had four chief executives since January 2022, has grappled with persistently high debt, mired finances and sapped investor confidence.
Onepoint, which formed a consortium with some Atos creditors that also includes Butler Industries and Econocom, plans to inject 250 million euros ($269.2 million) inequity into Atos, provide EUR1.5 billion in debt instruments and bank guarantees and convert EUR2.9 billion of existing debt into equity.
Atos said Tuesday that it would work with the Onepoint consortium to reach a definitive financial restructuring agreement to be implemented by July 2024. Existing shareholders would hold less than 0.1% of the share capital after the financial-restructuring is implemented, it said.
Atos’s decision to proceed with the Onepoint consortium comes after a series of acquisitions and investments across Europe by Kretinsky, who recently scooped up the U.K.’s Royal Mail postal service after owner International Distribution Services agreed to be bought for almost $5 billion.
Earlier this year, a Kretinsky-led consortium took control of embattled French supermarket owner Casino Guichard-Perrachon. In April, his EP Corporate Group also agreed to take a 20% stake of Thyssenkrupp’s steel business with the possibility of increasing it to 50%.
Atos shares have lost nearly 84% of their value since the start of the year. The company had previously said the rescue plan would cause a massive dilution of existing shareholders. Atos’s debt at the end of March deepened to EUR3.9 billion from EUR2.3 billion at the end of last year.
To stay afloat, Atos in April came to an agreement in principle with a group of banks, bondholders and the French State for much-needed liquidity.
France recently offered to acquire parts of Atos’s big data and security arm for up to EUR1 billion, underscoring efforts from the government to prevent a collapse of a company involved in sensitive operations.
Atos said the Onepoint rescue deal aligned with the corporate interests of the company, particularly those of its employees and clients.
It added that the offer was also generally consistent with the financial parameters it had outlined and that it provided adequate financial liquidity to fund the business and ensured a stronger capital structure.
Crucially, the deal had the support of a large number of Atos’s financial creditors, the company said.
“Today is an important milestone in our financial restructuring process,” Atos Chairman Jean-Pierre Mustier said. “This solution gives us a clear path to reach a final financial restructuring agreement by July.”
Write to Pierre Bertrand at pierre.bertrand@wsj.com and to Mauro Orru at mauro.orru@wsj.com
(END) Dow Jones Newswires
June 11, 2024 02:39 ET (06:39 GMT)
Copyright (c) 2024 Dow Jones & Company, Inc.
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