Why Paris is Stepping in to Rescue Atos: A French Perspective

 Atos, a crucial player in France's technology landscape and essential for the success of the upcoming Summer Olympic Games, faced financial challenges prompting it to seek assistance. In response, the French government stepped in to provide support, offering a €50 million loan as part of a larger interim financing package totaling €450 million. Led by Thierry Breton until his appointment to the European Commission in 2019, Atos holds strategic importance for France due to its involvement in various tech sectors such as cloud services, cybersecurity, and its role in defense interests, including ownership of supercomputing technology used for nuclear simulations.

Despite Atos' significant debt, it has been entrusted with the critical role of serving as the primary cybersecurity provider for the 2024 Olympics in Paris, which is expected to draw approximately 15 million visitors. This decision has raised concerns among security officials due to the potential risks of terror attacks and disruptions during the event. The head of France’s cybersecurity agency ANSSI expressed apprehension about Atos' financial challenges impacting the Games.

In response, Economy Minister Bruno Le Maire has been actively working on finding a "national solution" to protect Atos' strategic assets.Atos has faced challenges in securing a private sector rescue. Efforts to involve European champion Airbus in a potential acquisition were unsuccessful, as the aerospace group withdrew from discussions to purchase Atos' significant data and security division, considered its most critical segment. Similarly, Czech entrepreneur Daniel Křetínský ended negotiations to acquire Atos’ outsourcing information activities earlier this year.

Despite these setbacks, Economy Minister Le Maire has ruled out the option of nationalizing the company, a suggestion put forward by lawmakers across various political groups.The French Economy Ministry has refrained from commenting on discussions with potential buyers. Instead, the government opted to assist Atos in its search efforts with a €50 million loan. In return, the government will wield a special shareholder right, granting it authority over the handling of Atos' strategic assets.

Sébastien Jumel, a French MP from the left-wing opposition, expressed concern about the prospect of Atos falling under foreign control or facing bankruptcy, especially with the upcoming Olympic Games in France, for which Atos is an official partner. Jumel previously proposed the temporary nationalization of Atos as a potential solution. Sébastien Jumel emphasized that merely protecting strategic assets, such as nuclear deterrence, as proposed by the government, is insufficient.

A French Economy Ministry official, speaking anonymously to discuss the agreement openly, stated that Paris does not intend to notify the €50 million loan to the European Commission. The official argued that the loan was provided at market conditions and therefore does not require review under the European Union's state aid rules.French EU Commissioner Thierry Breton previously served as the CEO of Atos from 2008 until late 2019. He departed to join the European Commission as President Macron's alternative choice after former minister Sylvie Goulard was rejected by the European Parliament as France's nominee.

Thierry Breton has frequently referenced his prior experience as a tech CEO during his tenure as Internal Market Commissioner. In this role, he has implemented technology regulation and industrial policy initiatives across various sectors, including microchips, pandemic response, and most recently, the defense industry.During his time as CEO of Atos, Breton orchestrated several acquisitions of other tech firms, including Siemens IT Solution and Services in 2011 and French supercomputing leader Bull in 2014.

Breton has consistently emphasized that he bears no responsibility for Atos' financial difficulties, asserting that he left the company in a strong financial position.When Thierry Breton departed from Atos at the end of 2019, the company indeed had a net debt exceeding €1 billion due to its investments in new ventures. However, this figure didn't fully represent Atos' financial position because the company was simultaneously financing these acquisitions by gradually divesting its shares in its high-value payment and online services subsidiary, Worldline.

This strategic move injected liquidity into Atos and ensured its financial stability in the subsequent year, according to a close aide to Breton who spoke on condition of anonymity due to the sensitivity of the matter.By 2020, the effects of the sale of Worldline shares began to reflect on Atos' balance sheet, with its net debt dropping to below €500 million. However, the company's financial health deteriorated from 2021 onward.Breton's aide vehemently refuted any suggestions that Breton bore responsibility for Atos' financial troubles, dismissing such claims as false or defamatory.