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Atos Falls 12% After Choosing a Rescue Deal, Dilution is Massive

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Atos
Ludovic Marin | Afp | Getty Images

(CTN News) – Approximately twelve percent of the shares of the French information technology company Atos fell on Tuesday after the company disclosed that it has selected a rescue solution.

Atos is currently experiencing financial difficulties. The firm known as Atos is currently going through a period of serious financial troubles. There is a significant possibility that the deal will lead to a significant reduction in the ownership stakes held by the existing owners of the company.

A decrease in share prices that occurred at 10:51 a.m. London time was 11.8% lower than the dip that occurred during the previous session.

A proposal that was made by a significant shareholder named David Layani, whose information technology corporation Onepoint held around 11%’ share capital and voting rights as of December 2023, was approved by Atos, which declared that it will move forward with the proposal that was made by Layani.

Layani’s proposal was approved by Atos. Another possibility that Atos was not ruling out was the prospect of receiving a competing offer from the Czech billionaire Daniel Kretinsky.

This possibility concerned Atos.

However, the merger will result in a “massive dilution” of existing owners, who are expected to control less than 0.1% of the total share capital once it is completed,

According to Atos. This is despite the fact that the merger will affect existing shareholders. After the deal has been finalized, it is quite probable that this result will take place.

Atos asserts that the transaction that Layani successfully completed resulted in a more robust capital structure and provided the firm with adequate financial liquidity to enable it to continue its operations.

In line with the statement that the business made, “The proposal that was submitted by the Onepoint consortium also has the support of a large number of Atos’ financial creditors, which gives greater confidence that a definitive financial restructuring agreement will be reached.”

Layani made statements on Tuesday indicating that the participants in the transaction planned to improve Atos’ balance sheet and ensure that the firm developed into a significant international leader in the technology industry. Layani’s words were made in reference to the process of the acquisition. The information in question was reported by journalists working for Reuters.

One point, the investment firm Butler Industries, the information technology company Econocom, and a number of’ financial debtors are all members of the group that is providing support for the deal that involves Layani. Layani is also a member of the group. According to the forecast, it is anticipated that it will be approved and put into action by the month of July.

Atos is managing the 2024 Olympic Games in Paris.

Which is responsible for the management of data and cybersecurity. In addition to this, the firm is accountable for the upkeep of a number of confidential contracts with the French military as well as other organizations.

At the end of the first quarter, it was anticipated that the net debt of the corporation would amount to 3.9 billion euros, which is equivalent to $4.2 billion. The financial difficulties that this company has been facing, which include the accumulation of debt, have been getting worse over the course of several years.

Despite the fact that Atos has been going through some financial difficulties, the company has been in communication with a number of significant corporations, including Airbus, in order to discuss the possibility of engaging in a variety of business transactions.

A letter of intent to acquire a part of Atos’ business from the French government was announced by Atos at the beginning of this year. The company’s development was significant.

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Salman Ahmad is a seasoned writer for CTN News, bringing a wealth of experience and expertise to the platform. With a knack for concise yet impactful storytelling, he crafts articles that captivate readers and provide valuable insights. Ahmad's writing style strikes a balance between casual and professional, making complex topics accessible without compromising depth.

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