Investors give thumbs up to Atos' 4.3 billion-euro Gemalto bid

Investors give thumbs up to Atos' 4.3 billion-euro Gemalto bid

Gemalto has soundly rejected the Euro 4.3 billion takeover bid from Atos, saying it is best positioned to grow successfully and create long term value on a standalone basis.

"I've met the main shareholders and Bpi in particular", Breton said in a call with reporters following the announcement of the unsolicited bid for Gemalto.

Gemalto's board has confirmed that it will review the proposal and will respond by 15 December 2017.

The bid also comes against a backdrop of higher spending on cyber security worldwide, with research firm Gartner forecasting that 60 percent of organisations will invest in multiple data security tools up from 35 percent now.

Atos indicated that if the deal goes ahead, it would want to retain Gemalto's "talents" within the combined group, potentially extending to the company's local workforce.

Atos boss, Thierry Breton said: "We believe that a combination of Atos and Gemalto would result in enhanced global leadership in cybersecurity, digital technologies and services and in the strengthening of our positioning as a leading European payment services provider".

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Gemalto explained that the proposed price significantly undervalues the company, representing a discount of 27.4 percent against Gemalto's last 12-month high and premium of only 3.5 percent compared to the company's 12-month average share price.

"After a awful year 2017, Gemalto shareholders could not hope for better news than this bid from Atos", said Gregoire Laverne of Roche-Brune Asset Management, which sold its Gemalto shares a year ago.

The bid would be financed by Atos' existing cash resources and debt, the company said without elaborating.

"Considering increased risk that could impact Gemalto's shares, and for the purposes of market information, the Atos' board of directors has decided to make its proposal public while affirming its willingness to engage into discussions with the objective to come to a transaction recommended by the Gemalto's board of directors", Atos said in a statement. Atos, by contrast, had seen its stock jump 24 percent in the same period. It has also developed software for digital banking and data encryption for companies, according to its website.

The acquisition of Gemalto would be Atos biggest transaction in its history. Gemalto's customers include the likes of Amazon and Alibaba.

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