Atos appoints new CEO amidst financial restructuring plans

French IT firm Atos has appointed its chairman Jean Pierre Mustier as chief executive, replacing Paul Saleh.

The move came as Atos announced that the Commercial Court of Nanterre has opened accelerated safeguard proceedings to implement its financial restructuring plan.

Under the plan, €800 million short term interim financing will be available to Atos, secured until closing and to be refinanced with the €1,750 million new financings to be put in place before year-end 2024.

Concerns have been raised that the firm’s financial issues could severely impact the NHS, after it announced in April 2024 that it was facing around £3.2 billion debt.

Atos has almost a billion pounds’ worth of UK government contracts, which include running the technology behind the NHS records in hospitals.

In a market update, published on 24 July 2024, Atos said: “The opening of the accelerated safeguard proceedings marks the completion of an important step in the financial restructuring process of Atos and the start of a new era of recovery and development.

“In this context, Paul Saleh has decided to leave the group and has presented his resignation to the Board of Directors, which has accepted it with immediate effect”.

Mustier, former CEO of Italian bank UniCredit, has become the sixth Atos chief executive in three years, taking over with immediate effect from Saleh, who was appointed in January 2024.

In its market update, Atos said that the court had decided to open accelerated safeguard proceedings, “considering the strong level of support” from financial creditors.

It added that the purpose of the procedure is to enable the company “to implement its financial restructuring plan in accordance with the lock-up agreement reached between the company, a group of banks and a group of bondholders”.

Under a lock-up agreement, signatories undertake to support actions necessary for the completion of financial restructuring and are prohibited from selling shares for a specified period of time.

The main features of the financial restructuring plan in the agreement, announced on 15 July 2024, consist of €1.75 billion of new funding, a debt reduction of at least €3.1 billion and no debt maturing before year-end 2029.

Atos said: “The court has estimated that, with the level of financial creditor support and the information provided by the conciliator during the hearing, the financial restructuring plan should be successfully approved through the accelerated safeguard proceedings”.

The court hearing for the approval of the accelerated safeguard plan is expected on 15 October 2024.

Following the court’s approval, the plan will be implemented through several capital increases and debt issuances from November 2024 until January 2025.