The French Atos will cling to Mustier (formerly Unicredit) in the storm
The heavily indebted IT group appoints former Unicredit boss Mustier to replace chairman Bertrand Meunier. In the meantime, Atos postpones the disputed sale plan to Kretinsky, opposed by both some shareholders and French politicians
Storm for Atos, a French company that sells technological solutions, IT security and analysis to companies.
The company's president, Bertrand Meunier, has resigned and the conclusion of the disputed sale plan to Czech billionaire Daniel Kretinsky is postponed "to the beginning of the second quarter of 2024", the IT group announced today.
Bertrand Meunier will be replaced by Jean-Pierre Mustier,former number one of the Unicredit banking institution . In recent months, the company has been the subject of strong criticism from small shareholders and several French politicians, due to the proposal to divide Atos into two branches, to sell one of them (that of outsourcing activities or maintenance of IT parks) to Kretinsky .
The shares, which had started with a jump of over 20%, are now down 3.73%. Shares of the French IT services company opened at 5.7 euros and then reached a high of 5.97. Just over an hour after the opening of trading, the value fell to 4.66 euros, marking the annual minimum, Radiocor reports.
“Meunier's exit casts doubt on the restructuring and asset sale plan he supported at the highly indebted group, which owns assets deemed strategic by the French government,” comments the Financial Times .
All the details.
THE FORMER NUMBER ONE OF UNICREDIT TAKES AWAY
So Mustier, former CEO of UniCredit, will replace Bertrand Meunier, recently at the center of criticism from several minority shareholders after Atos abandoned an initial plan to split the company into two listed entities in favor of selling its largest division to Kretinsky.
According to Reuters , Mustier, who is credited with restoring UniCredit's balance sheet strength, will be tasked with reviving investor confidence after a governance crisis and series of setbacks hit Atos shares, now trading at historic lows.
WHAT WILL HAPPEN TO THE SALE TO KRETINSKY
Atos on Monday reiterated plans to sell its loss-making business known as Tech Foundations to Kretinsky under terms announced in August.
“The planned operation constitutes the most viable path for the separation of Tech Foundations (which brings together the historic outsourcing activities) and Eviden (cybersecurity, supercomputers and cloud, ed.) and to improve the risk profile of the group), indicates Atos.
However, the company said it now expects to complete the deal in the second quarter of 2024. Previous deadlines had predicted the deal would close by the end of this year. The deal would allow Kretinsky to acquire a 7.5% stake in Atos' remaining assets, Eviden.
FINANCIAL TURBULENCE FOR ATOS
As the FT recalls, Atos has struggled to turn its business around under Meunier's tenure, and his plan to split the group has been fraught with difficulties and delays. Earlier this month it appointed a new chief executive, its third in two years.
Atos shares have fallen more than 90% over the past five years. And now the change at the top comes as Atos is in talks to sell Tech Foundations to Kretinsky.
“If the transaction with Epei (Kretinsky's group) does not take place, the group will have to access the capital markets (debt and equity) and/or consider selling additional assets” to “address debt maturities in the 2025”, says the French company. In fact, Atos must refinance a 1.5 billion euro term loan maturing in January 2025 and 750 million euro bonds maturing in May 2025. In the end, Atos management wants everything that comes in to carry out this plan of separation.
CONVINCING SHAREHOLDERS
The sale of Tech Foundations would imply a capital increase of 900 million euros by Atos, of which 180 million euros reserved for Kretinsky's group. But not all shareholders agree, on the contrary.
Two minority shareholders, the Alix Am and Ciam funds, have filed a complaint with the National Finance Prosecutor's Office, the first for active and passive corruption, the second for 'false or misleading information'. Others, gathered in the Union of Constructive Shareholders Atos, are preparing an 'alternative strategic plan' without a sale.
Also today, Atos management promises that shareholders will receive "all the necessary information" on the final operation, the remaining scope (Eviden) and the financing, for approval by the general meeting. This applies in particular to the final terms of the operation and the capital increases aimed at strengthening Eviden's capital structure, which are “interconditioned with the planned sale of Tech Foundations”, underlines the French newspaper La Tribune .
However, the risk remains that shareholders will not approve the capital increase given its dilutive nature, which could prevent the Kretinsky deal from being concluded, the Financial Times adds.
WHY THE FRENCH GOVERNMENT IS ON ALERT
Finally, the French government has also been following the company's situation closely because Atos owns the quantum computing technology used to carry out work for the French nuclear weapons program.
The Tribune also recalls that the protest also took a political turn: in August, 82 LR parliamentarians asked that Atos be kept "under French control", especially because its branch specialized in supercomputers is essential for the simulation of tests nuclear and for deterrence. “Even if the operation were completed, it would have no impact in terms of control or blocking of rights on sensitive activities,” Prime Minister Elisabeth Borne responded at the end of September.
In 2020, the French Atos was also awarded the works for Leonardo, the European supercomputer managed by the Italian multi-university consortium Cineca, installed at the Bologna Tecnopolo, inaugurated last November . Not only that, the company had won two other contracts in the quantum computing sector: Vega, the calculator in Slovenia for 17.2 million, and Meluxina, the petascale machine from Luxembourg (30 million). Furthermore, the aerospace and defense group Leonardo (formerly Finmeccanica) had chosen Atos as a technological partner for the development of the Davinci-1 group supercomputer installed in Genoa, in one of the six Italian locations of Leonardo Labs.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/la-francese-atos-nella-bufera-si-aggrappera-a-mustier-ex-unicredit/ on Mon, 16 Oct 2023 13:06:04 +0000.