Atos Chooses Onepoint Over Kretinsky for French Company’s Rescue Plan

Atos SE Opts for Onepoint-Led Bailout Over Kretinsky's Bid

Atos SE, a struggling French IT company, chose a bailout proposal from a consortium led by David Layani’s Onepoint, edging out a competing bid from Czech billionaire Daniel Kretinsky. This decision, backed by Atos's board, involves new equity and reduced debt and aims to finalize an agreement with creditors by July.

Support and Plan Details

The Onepoint-led bid has received support from Paris-based Butler Industries and Econocom Group SE. The plan, dubbed "One Atos," will significantly dilute existing shareholders but keeps the company under French ownership. Layani, 45, will take over as CEO.

Comparing Proposals

Kretinsky’s proposal aimed for more aggressive debt reduction by selling off Atos's digital business. Currently burdened with nearly €5 billion in debt, Atos has been undergoing a formal restructuring process since April to avoid bankruptcy.

Market Reactions

Following the announcement, Atos shares dropped 11% while its distressed bonds saw a notable rise. The €350 million notes due in November 2028 increased by 4.6 cents on the euro, the largest hike since April.

Offer Breakdown

The Onepoint consortium's offer includes €250 million in new equity, €1.5 billion in new debt, and the conversion of €2.9 billion of Atos's current debt into shares. This approach has garnered substantial support from Atos's financial creditors and aligns with the company's interests.

Implications and Analyst Insights

This restructuring will lead to significant dilution, introducing approximately 2.5 billion new shares versus the current 112 million outstanding shares. Despite these changes, agreements with creditors are still needed.

Background and Context

Founded in 2002, Onepoint, with €500 million in revenue last year, is substantially smaller than Atos, which recorded €10.7 billion in revenue. Over the past year, Onepoint became Atos's top shareholder amid the latter’s failed deals, management upheavals, and collapsing valuation.

Kretinsky's Bid and Interest

Kretinsky's EPEI group, known for its investments in distressed companies, had completed the takeover of French grocery chain Casino Guichard Perrachon SA and is in the process of acquiring the UK's Royal Mail. It targeted Atos initially by seeking to buy its legacy IT division before proposing a rescue bid.

From Premiership to Plummet

Atos, once a leading tech company in France, aimed to rival Accenture Plc and Capgemini SE but faced accounting scandals and massive debts, leading to its near insolvency. Despite losing 90% of its value over the past year, Atos remains integral to France's IT services with key contracts in the defense, nuclear, and Olympic sectors.

Government’s Role and Future Steps

The French government aided with €50 million in interim funding and offered to buy Atos's sensitive supercomputing unit. France's restructuring mechanisms face a fresh test with Atos following the failures of Orpea and Casino. Additionally, Atos is considering offers for its smart energy business, Worldgrid, with Finance Minister Bruno Le Maire suggesting that public energy giant Electricite de France SA might take control.

Atos's declining fortunes and the ongoing restructuring efforts will be closely watched, given the company's strategic importance and the economic and political implications for France.