The Channel logo

News

By | Kelly Fiveash 15th December 2010 11:10

Atos Origin buys Siemens IT wing in €850m deal

Breakfast of 'European IT champions'. Or something

French services giant Atos Origin is buying Siemens IT unit Solutions and Services (SIS), after signing an €850m deal with the German multinational.

Under the agreement, Siemens will be a “sustainable shareholder” of Atos Origin for at least the next five years, with a 15 per cent stake, or 12.5 million shares, worth €414m.

Siemens will also be handed a five-year convertible bond of €250m and a cash payout of €186m.

Atos Origin said the acquisition would bring in pro forma 2010 sales of around €8.7bn and bump up the company’s staff headcount to 78,500 workers worldwide.

But SIS will be hit with job cuts with a workforce reduction of 1,750 people planned.

The deal will also have a “considerable negative earnings impact” in Siemens 2011 financial year.

As part of the agreement Siemens said it had concluded a seven-year outsourcing contract with Atos Origin worth around €5.5bn. Under that global deal, the French services outfit will manage Siemens’ systems and IT infrastructure.

The two companies hope that their combined effort will create a “European IT champion”. ®

comment icon Read 3 comments on this article alert Send corrections

Opinion

Alexandre Mesguich

Change is order of day as tech giants shift strategy gears
Partnership

Frank Jennings

Confused? No problem, we have 5, no 6, no 7... lots of standards

Chris Mellor

VC sequence could end not with a bang, but a whimper
Sad man stares glumly over boxed contents of desk. Image via shutterstock (Baranq)

Features

money trap conceptual illustration
Big boys snare the unwary with too-good-to-be-true deals
Angus Highland cow
Pet carriers not wanted for whitebox stampede
FBcoldstoragearray
Sorry OpenStack and Open Compute, we're not all Facebook
Gary Kovacs, CEO of AVG. Pic: World Economic Forum
Scammy download sites? Government snooping? Run of the mill for Gary Kovacs