French government seeks to buy assets from Atos

The French government has proposed buying key assets of Atos, the heavily indebted technology company, for up to €1bn because Paris wants to keep them in national hands.

The state wants to purchase three strategic parts of Atos: super calculators for quantum computing, which are used by the French army for the country’s nuclear weapons programme; secure communications tech also used by the military; and certain cyber security assets.

Amid concerns in Paris that foreign investors, including hedge funds, could gain control of Atos in an upcoming restructuring of its €4.8bn gross debt, finance minister Bruno Le Maire said that the state had sent a non-binding letter of intent to the French company about purchasing the assets. Atos on Monday confirmed the offer, for an enterprise value, which usually includes debt, of between €700mn and €1bn.

“There are sovereign assets in Atos that must stay within the exclusive control of France,” Le Maire told news channel LCI on Sunday. “We have signalled our interest in acquiring all the strategic assets of Atos.”

As it races to organise its debt restructuring, Atos on Monday also revealed a bleaker financial picture than it had given in early April. It doubled its short-term cash needs across both 2024 and 2025 to €1.1bn from a previous €600mn estimate, taking its total funding needs to €1.7bn, up from a previous estimate of €1.2bn.

It also said it now aimed to cut gross debt by €3.2bn, compared with a €2.4bn target previously. Atos has asked for proposals by Friday from top shareholders and creditors to achieve that debt reduction. Atos shares rose about 17 per cent in morning trading in Paris on Monday.

The French government has stayed out of much of the turmoil at Atos, now chaired by former UniCredit boss Jean Pierre Mustier, as the company churned through several chief executives and made several strategic U-turns in the past three years.

But as Atos’s financial position worsened, the state in early April announced it would provide a €50mn short-term loan and create a “golden share” system for the company’s sensitive assets, which would allow ministers to block any acquisitions they did not approve of.

The assets the government was proposing to buy generated about €900mn in annual revenues and employed 4,000 people, an economy ministry official said.

That represents less than 10 per cent of Atos’s 2023 sales, and 4 per cent of the total workforce.

The French government’s proposal was not a forced nationalisation, the economic ministry official said.

“The group welcomes this letter of intent, which would protect the sovereign strategic imperatives of the French state,” Atos said.

The state would potentially make a firm offer by June. The government’s letter of intent was made via the APE, an agency that manages the French state’s stakes in companies including utility EDF and telecoms group Orange.

Le Maire said the government would seek to rally French industrial groups to join its bid in a consortium.

“We will see what other players might want to participate — it will only be French groups in strategic sectors such as defence or aerospace,” Le Maire said.

Dassault Aviation, the French maker of Rafale fighter jets, has previously expressed interest in some of Atos’s assets, according to people briefed on the situation.

Thales, the French defence electronics group, would be another potential participant for the state to enlist.

Thales declined to comment, while Dassault did not respond.

Atos has had various failed talks with individuals and companies interested in buying some of its assets, as the group has sought to raise cash to reduce its debt load.

They include Czech billionaire Daniel Křetínský and Airbus.