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Report information:

NelsonHall Report

Mergers and Acquisitions

by Rachael Stormonth

published on Dec 14, 2010

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Report Overview:

Report Outline:

Atos Origin is to acquire Siemens IT Solutions and Services for €850m, in an arrangement through which Siemens will receive approximately 12.5m of Atos Origin shares (a 15% stake) currently at €414m, a 5-year convertible bond of €250m and a cash payment of approximately €186m.

As part of the transaction, Siemens has awarded Atos Origin a 7-year €5.5bn outsourcing contract to provide managed services and systems integration services to Siemens AG

The combined entity will have pro forma 2010 revenues of ~€8.7bn and 78,500 employees worldwide. It is expected to generate

  • Revenue growth in line with market growth in 2011 and with a 6% operating margin.
  • Revenues of €9 to €10bn and a 7% to 8 % operating margin by 2013.

Siemens will support Atos Origin in integrating Siemens IT Solutions & Services by reshaping its pre-acquisition. As part of this it is envisaged that Siemens IT Solutions & Services headcount will be reduced by 1,750, including 650 in Germany. Siemens is to contribute up to €250m to the integration and training costs.

The transaction is expected to close by the start of July 2011.

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