Hedge fund manager Chris Hohn demands Airbus drop Atos deal

By Nell Mackenzie

LONDON (Reuters) – Hedge fund supervisor Christopher Hohn has written to Airbus demanding it drop a deal to buy a minority stake in French IT consulting agency Atos’ soon-to-be spun-off division Evidian.

In a public letter to the planemaker on Monday, Hohn mentioned that Evidian was a “extremely levered firm” and investing in it will “dilute the standard of Airbus’ enterprise.”

Hohn, who runs hedge fund TCI Fund Administration, owns over 3% of Airbus’ shares value greater than 4 billion euros ($4.3 billion), the letter mentioned.

The letter was first reported by the Monetary Instances.

France-based Airbus has submitted a proposal to Atos’ board to accumulate a 29.9% stake in Evidian, however will even carry out an “in-depth due diligence interval and can refine the main points of its potential settlement with Evidian,” an Airbus spokesperson mentioned, with out immediately commenting on the criticisms within the letter.

The indicative supply is wanting the 30% threshold that will routinely set off a full bid for Evidian.

“There could be no certainty at this stage {that a} transaction will happen,” the spokesperson added.

If profitable, the deal would give Airbus some say over Evidian, which teams Atos’ most coveted belongings corresponding to cybersecurity division BDS and supercomputers.

Atos, whose purchasers embrace France’s administration and armed forces, would in return safe much-needed funding from a European industrial group because it strives to hold out its split-up plan after a troubled interval marked by a governance disaster, heavy losses and sharp inventory value swings.

Hohn, within the letter, mentioned if the deal goes by means of Airbus ought to disclose what it will spend to pay down any debt or different liabilities of Atos.

Airbus shares have been down 2% in afternoon buying and selling, whereas Atos’ shares have been down 0.3%.

($1 = 0.9359 euros)