Atos Buyout Speculation: Will Private Equity Acquire Global IT Consulting Firm?
Several private equity firms are examining Atos as a potential take-private acquisition target, according to Unquote. The global IT consulting firm’s market capitalization was $5.57 billion as of August 9, 2021, according to SeekingAlpha.
Speculation about a potential Atos buyout comes as the Paris, France-based technology company considers selling off certain data center assets to focus on faster-growth cybersecurity and cloud migration opportunities.
Cinven is among the private equity firms interested in acquiring Atos, Unquote reports. KKR, Advent International and Bain may also be giving the IT consulting firm a look, the report adds.
Cinven’s investment period for its portfolio companies is typically four to five years, according to the private equity firm’s website. Existing Cinven investments include Spain telecom operator MasMovil, and international fiber infrastructure provider Ufinet, among others in the IT sector.
ChannelE2E has not independently confirmed the Unquote report.
Atos: IT Consulting Business Challenges
Shares in Atos have fallen about 46 percent from August 2020 through early August 2021, SeekingAlpha data shows, amid inconsistent financial results.
Atos also experienced accounting concerns with its U.S. business in early 2021, though a deeper investigation revealed no major issues or wrongdoing, according to a follow-up Atos statement in mid-2021.
Atos, based in Paris, is struggling to grow top-line revenues at a time when many rivals are experiencing strong or accelerating growth. Indeed, Atos revenue in the first half of 2021 was 5.4 billion euros (roughly $6.4 billion U.S. dollars), down one percent compared to the first half of 2020, the company disclosed July 27, 2021. In stark contrast, rival Accenture revenue grew nearly 21 percent in Q3 of fiscal 2021, that company reported on June 24, 2021.
Atos: Noteworthy Cybersecurity, Snowflake & Salesforce Partner Acquisitions
Even amid the business challenges, Atos has remained in acquisition mode in 2021. Key deals have included:
- July 2021: Acquring Visual BI, Nimblix and Ideal Grp. The companies offer expertise across Snowflake, high-performance computing and manufacturing expertise.
- March 2021: Buying Processia, Cryptovision, and Ipsotek to boost the global IT consulting firm’s product lifecycle management (PLM), cybersecurity and video analytics capabilities.
- February 2021: Acquiring Salesforce partner Profit4SF.
- January 2021: Buying Fedem, a Canadian cybersecurity consulting firm.
In some ways, the Atos business evolution mirrors that of IBM. Indeed, IBM plans to spin off its Kyndryl managed infrastructure business in late 2021. Under CEO Arvind Krishma, IBM has been acquiring faster-growth hybrid cloud consulting companies.