Atos’ market cap sits at a historical low of 315 million euros. The French IT concern now wants to massively reduce the number of shares it offers, bringing them back to a digestible amount.
The change is what’s known as a reverse stock split, meaning shares will be consolidated. The process begins on March 25 and by April 23, it should be complete. The company says it is taking these steps to create “a new stock market dynamic.”
Successful companies sometimes want to perform a stock split, going the opposite way and diluting shares, leading to the price per share getting back to a manageable number. One example is Nvidia, which went from being worth several hundred billions to trillions of dollars in a steep AI surge, making a single Nvidia share nearly $1,200 at one point. That has since been decimated, leading to a 10x increase in tradeable shares.
Historically low
A single Atos share, by contrast, is worth $0.0049 at the time of writing. Anyone wishing to get one share paid out would therefore have to cut a eurocent in half. Now, every 10,000 Atos shares held by an investor are set to become one, which are meant to start out at 49 euros apiece.
The explanation for Atos’ low trading value is complex. The IT provider, of great importance to French defense, has gone through seven CEOs in about three years. Now, however, the company wants to look to the future again, drawing hope from financial aid provided by the French state. We recently discussed the outlook with Punit Sehgal, responsible for Atos and Eviden’s operations in the Benelux & Nordics.
Read more about this: Atos under pressure: what does the French rescue mean?
New news
The number of unexpected developments in the Atos saga is large and can be read back in our erstwhile liveblog. Now there are also developments to report that are not about the IT player’s survival and financial woes. For example, it recently expanded its portfolio in the area of managed security within the Google Cloud service.
Also read: Atos expands Google Cloud services with managed security