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Airbus has pulled out of talks with Atos over a potential deal to buy its prized data and security business, jeopardizing efforts by the French IT services company to avoid going into debt restructuring.
The end of discussions on a deal that could be worth up to €1.8 billion sent Atos shares falling by as much as 25 percent on Tuesday morning before trading was briefly suspended.
Atos shares have lost more than 90 percent of their value in the past three years, raising the company's market value to 188 million euros.
Its Big Data and Security division houses the company's cybersecurity and supercomputing capabilities. In addition to managing sensitive contracts with the French military, she was also contracted to manage cybersecurity for the Paris Olympics this summer.
Airbus said on Tuesday that “after careful consideration of all aspects of the potential acquisition”, it had decided to end discussions. Atos is “analyzing the resulting situation and actively evaluating strategic alternatives,” it said in a statement, as it delayed announcing its annual results for the second time in recent weeks.
This is the second time talks over a potential deal between Atos and Airbus have collapsed in just over a year. Airbus decided that splitting up the unit and then merging it would be too complex and risky, according to people familiar with the situation, since Atos' business consists of many entities in different countries. The French company's broader financial distress also played a role in the decision, the sources said.
“Airbus will never come back – its image is dead with Atos,” said one person familiar with the situation.
Airbus and Atos confirmed in January that talks on the unit were underway, with Atos Chairman Jean-Pierre Moustier seeking options to deal with the company's large debt burden, while trying to allay political concerns that Atos divisions with sensitive missions related to… With national security, you will not fall into the trap. Foreign hands.
Mustier's options have now narrowed considerably, after a separate deal with Czech billionaire Daniil Kretinski to buy Atos' old, loss-making business collapsed in February.
Atos faces a €3.65 billion debt repayment before the end of 2025 – which it has been trying to postpone until 2028 in talks with its bank lenders – and is burning through cash quickly. The company reported negative free cash flow of €1 billion last year – five times higher than in 2022 – while net debt totaled €2.23 billion.
Credit rating agencies downgraded the group's debt to junk status and warned of its weak liquidity amid high cash burn.
The company will now try to increase the pace of negotiations with its creditors, which are being overseen by a recently appointed mediator in a process that remains voluntary, according to several people familiar with the process. But if this fails, Atos may need to enter court-supervised bankruptcy proceedings.
Kretinsky may consider returning to the table with an offer to buy more of the company, according to people familiar with his thinking. They estimate that Atos will need a capital injection of at least 600 to 700 million euros of new money, but his team is waiting to be courted, the sources said.
David Liani, the major Atos shareholder and founder of digital consultancy Onepoint, who has built an 11 percent position in the company and joined the board in recent months, has also expressed ambitions to take control of Atos and anchor the capital raise, according to people familiar with the matter. With his thinking.
“Athos will continue with the broker. They have no immediate liquidity problems. They will open negotiations with creditors and shareholders…And so will Liani and Kretinsky,” said the person familiar with the situation.
