French IT giant Atos seeks over $1 bn in funding amidst financial struggles

Atos, a French IT firm, has announced its pursuit of more than 1 billion euros ($1.09 billion) in new funds, as reported by Bloomberg, citing insiders familiar with the matter. The company intends to address its financial distress through a restructuring plan unveiled during a confidential meeting. 

With the aim to alleviate its burdensome $5 billion debt, Atos plans to convert approximately half of this debt into equity, Bloomberg revealed. This move comes amidst Atos grappling with a substantial debt load, with €3.65 billion ($3.95 billion) due by the end of next year. Despite efforts to alleviate its financial strain, including talks to offload business segments to potential buyers like Czech billionaire Daniel Kretinsky’s EPEI and Airbus SE, Atos has found itself in a risky position. 

The situation has prompted the French government to take a keen interest in protecting Atos, which plays a crucial role in managing data and cybersecurity for national security programs, including those related to nuclear weapons and the upcoming Paris Olympics. The failure of negotiations with potential buyers has intensified the urgency of finding viable solutions to Atos's financial challenges. 

Earlier this year, Airbus had expressed interest in acquiring Atos's big data and security (BDS) unit with an indicative offer ranging from 1.5 billion to 1.8 billion euros ($1.64 billion-$1.97 billion). However, Airbus withdrew from the deal last month following a comprehensive "due diligence" investigation, leaving Atos in a lurch. 

Due to this, Atos has once again postponed the release of its audited financial statement for 2023 as it navigates its options. Delays in publication have already occurred to allow auditors additional time to review an independent business review report and complete their audit, further underscoring the company's financial strain, the report said. 

In an effort to rescue Atos from its distress, Paris-based Butler Industries is reportedly joining a consortium, according to a Reuters report cited by Onepoint, Atos's leading shareholder. Onepoint, holding an 11.4% stake in Atos, has expressed readiness to invest and orchestrate the group's capital restructuring, aiming to safeguard the integrity of its assets following Airbus's withdrawal from the cybersecurity assets deal. 

As Atos endeavors to secure new funds and navigate its restructuring efforts, stakeholders are closely monitoring developments amid uncertainties surrounding the company's future.