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French IT companies Atos and Sopra in takeover battle for peer Steria

21 Apr 2014

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SteriaFrench IT companies Atos and Sopra Group SA are in the midst of a €730-million ($1 billion) takeover battle for peer Groupe Steria SCA.

Early this month Sopra tabled a friendly agreed €730 million all-stock bid for Steria, in order to create the third-largest computer-services provider in the country. (See: French IT services firm Sopra to buy rival Steria for $1 bn)

Sopra has offered one share for four Steria shares, at an exchange value of €22, amounting to a 40-per cent premium to Sopra's recent closing share price.

On 17 April, Steria revealed that it had received a similar offer on 4 April from Atos, but its board said that it would go ahead with the Sopra proposal.

Steria had rejected the Atos proposal saying that it had "clearly indicated that it did not wish to enter into discussions with Atos,'' and added, "It was therefore an unsolicited step and one aimed at disrupting the exclusive ongoing negotiations with Sopra Group."

Steria employees holding 17.45 per cent of the capital and 20.92 per cent of voting rights, have agreed to tender their shares to Sopra's offer.

Atos over the weekend said that its offer would remain on the table until the Sopra's extraordinary shareholders meeting on 27 May.

Sopra and Steria are among the oldest IT firms in Europe and the merged company aims to generate revenue over €4 billion and an operating margin gradually improving towards 10 per cent.

The companies expect to generate annual operational savings of €62 million a year starting in 2017.

Headquartered in Issy-les-Moulineaux and founded by Jean Carteron in 1969, Steria focuses on public services, finance, telecommunications, utilities and transport.

The Euronext Paris-listed company also provides consulting services for its clients' core business processes, and develops and operates their information systems.

It operates across 16 countries and posted 2013 revenue of €1.75 billion.

NYSE Euronext Paris-listed Sopra employs more than 16,000 people and generated revenue of €1.349 billion n 2013.

One of Europe's longest established IT services companies, Sopra positioned itself in all segments of the value-added IT services sector and soon became a key player in the French market.

The company also built up expertise in software development and set up two specialist companies, Axway Software and Sopra Banking Software.

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