Atos - comment

Krentinsky's final and best offer from last week has apparently improved.  According to BFM Business, the improved offer is for creditors to receive c.20% of the equity in warrants/options in order to entice creditors to vote for his plan.  This improved offer is likely behind the Conciliator’s request to extend the timeframe to select the preferred financial restructuring proposal to the beginning of next week. 

We still view creditors as the key decision maker with some of these investors having entered into Atos capital structure in the last 6 months (at prices higher than current levels) on the basis of the expected enterprise value of Atos.  Therefore it is difficult to now accept an offer, however improved, from Krentinsky, and give away the vast majority of the perceived upside.  Or, it is the basket case we have always suspected and Layani’s role drops to that of a stalking horse when creditors accept a maximum bid from Kretinsky.