Atos receives four restructuring bids as creditors battle for control of ailing company

The IT reselling giant said it is aiming to find an agreement by July

Atos receives four restructuring bids as creditors battle for control of ailing company

French IT reseller Atos has received four new debt restructuring proposals.

The proposals came from a group of Atos' existing creditors, Bain Capital, EP Equity Investment controlled by Daniel Kretinsky, and Onepoint controlled by David Layani, which is also the reseller's largest shareholder.

Atos' board of directors has already decided to reject Bain Capital's bid as the "offer did not meet the company's objectives of considering its full business scope".

Atos aims to select a financial restructuring solution acceptable to its creditors by 31 May and reach a final agreement by July 2024.

The company warned that this is likely to involve radical changes to its capital structure and significant new equity issuance, resulting in "massive dilution" for existing Atos shareholders.

Jean-Pierre Mustier, chairman of the Atos Board, expressed gratitude to the parties that submitted proposals and noted that the bondholders and banks are working constructively toward a refinancing solution.

CEO Paul Saleh stated confidence in reaching a final agreement by July that would assure business continuity for clients and serve the interests of employees, clients, suppliers, creditors, shareholders and other stakeholders.

Financial shake-up

The restructuring efforts come after a difficult few years for the IT reseller.

In the first quarter of 2024, Atos' group revenue declined by 2.6 per cent or €2.5m compared to Q1 2023. The Eviden business division saw a 3.9 per cent revenue drop, which Atos attributed to softer market conditions in the Americas, down 7.5 per cent, and the UK.

Tech Foundations revenue also fell 1.5 per cent due to lower scope of work with certain customers in the Americas and Central Europe.

Alongside the restructuring efforts, Atos is in discussions with the French state regarding the potential acquisition of 100 per cent of its Advanced computing, mission-critical systems and cybersecurity products activities by the state agency APE.

The French government expressed interest in acquiring these activities earlier this year under Atos' big data & security (BDS) business, which represented around €1bn in revenue out of the €1.5bn total for the BDS division in 2023.

Atos told CRN that the letter of intent from the French state was aimed at protecting sovereign strategic imperatives.

In a separate development, Atos has signed a €100m interim financing deal with a group of bondholders and received approval for a €50m state loan, while negotiations continue with banks for a €300m factoring facility.