Atos Offers $844 Million to Buy Bull in Cybersecurity Push

Atos CEO Thierry Breton
Thierry Breton, chief executive officer of Atos SA,. Photographer: Hannelore Foerster/Bloomberg

Atos of France offered to buy rival Bull for about 620 million euros ($844 million), underscoring demand for cybersecurity and cloud-computing services.

Atos is bidding 4.90 euros a share in cash, 22 percent more than Bull’s May 23 closing price, the companies said today. Bull shares jumped to 4.89 euros in Paris trading, and Atos rose 6.2 percent. The offer is recommended by both companies’ boards and owners of about 24.2 percent of Bull’s shares have agreed to tender their stock, Atos said.

Software companies such as Atos and Germany’s SAP AG are using acquisitions to expand in cloud computing, or technology that allows data to be accessed remotely via the Web. The takeover will strengthen Atos’s business in areas such as super-computing -- techniques used to analyze large amounts of data with complex mathematic algorithms -- and cybersecurity. The companies reported combined revenue of almost 10 billion euros last year.

“This deal reinforces us in key segments like cybersecurity and cloud computing, which have double-digit growth potential,” Atos Chief Executive Officer Thierry Breton, who worked at Bull from 1993 to 1997, including as vice chairman, said during a press conference in Paris.

Bull, which in the 1990s made everything from bank machines to microchips, today sells software to customers including retailer Carrefour SA, electricity provider Electricite de France and oil company Total SA. It also develops technology for secure smartphones that are used by the military and sensitive industries.

Rebuffed Bid

The offer for Bull came weeks after Atos was rebuffed in its bid for Groupe Steria SCA, one of France’s oldest computer-services providers. Steria last month said it’s sticking with a rival offer from Sopra Group SA and described Atos’s proposal as unsolicited and designed “to disturb” its talks. Breton said today the Steria offer remains valid.

Atos is paying 9 times Bull’s earnings before interest, taxes, depreciation and amortization, compared with 15 times for comparable transactions compiled by Bloomberg.

The enlarged entity would have about 400 million euros in annual revenue from cloud computing, making it the leading European supplier of such services, according to a company presentation. Sales from so-called big data and cybersecurity services would reach almost 500 million euros. Atos and Bull also generate revenue from consulting and managed services.

Earnings Boost

The takeover is expected to lift Atos’s earnings per share as early as the first year, and by more than 10 percent within 24 months of integration. Atos plans to remove Bull’s stock listing after the transaction, which is subject to the company winning at least 50 percent plus one share of Bull’s capital, Atos said.

Atos rose 5 percent to 63.46 euros, giving the company a market value of 6.2 billion euros.

Orange SA, France’s former phone monopoly, owns about 8 percent of Bull, while the state investment arm Caisse des Depots et Consignations has a 5 percent stake, according to data compiled by Bloomberg. Crescendo Industries, a holding group co-founded by Bull CEO Philippe Vannier, is the largest shareholder with about 20 percent.

Sebastien Audra, an Orange spokesman, said the carrier will examine Atos’s offer, calling it “interesting and constructive for Bull’s future.”

Rothschild is the sole financial adviser for Atos. Paul Hastings LLP worked with Bull.


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