What company structure? What are the prospects for turnover and profits? And, on these bases, what amount of debt is sustainable? These are three vital questions that Atos management must answer this Monday, April 8, during a meeting organized with its resources, banks and debt funds. The IT group is drowning in gross debt of 4.6 billion euros (2.3 billion euros once cash flow is taken into account), a sum that it cannot repay: it was forced to place in conciliation, on March 26, under the aegis of the Interministerial Committee for Industrial Restructuring, the Bercy service responsible for managing the difficulties of complex companies.
Its structure will resemble the current one. Negotiations to sell Tech Foundations, the outsourcing division, to Czech businessman Daniel Kretinsky broke down on February 28. Twenty days later, on March 19, Airbus gave up on buying Big Data & Security, the cybersecurity and supercomputers business. After these failures and in a period of conciliation, Atos is no longer in a position to negotiate asset sales of this magnitude. Smaller sales remain possible, but the initial plan which aimed to dismantle the group to repay the debt is no longer a priority. And too bad if the company spent 382 million euros, in 2023 alone, on costs of all kinds (consultants, lawyers, bankers, etc.) to prepare a separation plan which ultimately never saw the light of day.
The priority is to reduce debt, because cash flow is tight. Thursday April 4, Atos management announced to its employees, by email, “a negative adjustment of (their) variable compensation plan for the second half of 2023 ». Bonuses will be reduced by 15% to 25% for “all eligible employees”. This arbitrary decision was poorly received by the employees, who had voted in the transformation plan for two years, but the group needs to contain its cash outflows.
Interest from David Layani and Onepoint
In this context, the “refinancing framework” prepared by Atos promises to be painful for lenders and shareholders. The prime ministers will waive part of their debts, agree to transform another part into shares and postpone the repayment of the residual debt over time. The latter will suffer the effects of an inevitable capital increase, which will mechanically dilute their weight. A protagonist in the file estimates that he should reduce the debt by half and inject around a billion euros.
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