Atos’ shares plunged 27% on Monday after it cancelled plans for a rights issue, citing “changes in the market environment.”
Atos’ shares fell 27% on Monday after it cancelled plans for a rights offering, citing “changes in the market environment,” and said it had begun discussions with its banks about refinancing its debt.
Atos, which last month named its fourth new CEO in less than two years and has issued a number of profit warnings, said it would seek the appointment of an impartial third party to enable negotiations with banks.
BNP Paribas and JPMorgan’s standby underwriting pledge for a 720 million euro ($776 million) rights offering was no longer in effect, Atos said.
“Atos will inform the market in due course of the progress of the discussions with its banks, its new refinancing plan, its contemplated disposals, as well as the possible changes in its capital structure that could result in a dilution of the existing shareholders,” according to the statement.
By 0857 GMT, Atos shares had fallen 27%, bringing their year-to-date decline to more than 50%.
In November, the IT service provider announced that it was exploring approaching capital markets and selling more assets to fund the capital raising strategy, which included a 1.5 billion euro term loan maturing in January 2025 and 750 million euros in bonds payable in May 2025.
Atos is in talks to sell Tech Foundations, its loss-making IT consulting subsidiary, to Czech tycoon Daniel Kretinsky’s EPEI firm, but there is “no certainty that these negotiations will result in an agreement,” according to the company.
The company warned in January that its free cash flow would be slightly lower than its initial target for the second half of 2023.
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