France’s Atos opens talks on debt restructuring after record losses

By Augustin Turpin and Mathieu Rosemain

(Reuters) -Atos, the crisis-hit French IT consultancy whose shares have tumbled over the past two years, said it aims to restructure its heavy debt load by July, paving the way for a possible capital increase to balance out strengthen sheet.

The Paris-based group, founded and previously led by EU industry chief Thierry Breton, will try to reach an agreement with creditors on the entire debt, 4.65 billion euros at the end of 2023, the report said.

Atos says it still has enough liquidity to run the business for now, but its debt burden has become unsustainable, with debt reaching 3.65 billion euros by the end of 2025, after recent attempts to inject fresh cash by selling off parts of the group failed.

Airbus’s withdrawal from talks to acquire the company’s most valuable asset, cybersecurity BDS, came on top of the recent collapse of negotiations with Czech billionaire Daniel Kretinsky over the sale of Atos’ loss-making operations.

The talks with bondholders and banks will take the form of a so-called amicable mediation procedure and will take place under the supervision of the court, Atos said, adding that it will inform the markets in the coming weeks.

The group said an agreement to restructure its debt could lead to fresh cash injections in the form of new equity, resulting in dilution of existing shareholders.

Atos, which owns assets considered strategic by the French government and is struggling to turn around its money-losing business, posted a record net loss of 3.44 billion euros ($3.73 billion) for the year ended Dec. 31, after a loss of 1.01 billion euros. in 2022.

More than two-thirds of the losses arise from impairment related to…

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