France’s Atos Swoops for DXC in Bid to Create IT Giant

Shares in Atos, which offers services such as infrastructure and cloud applications for businesses, fell as much as 11% Thursday.

Photo: Niviere David/Zuma Press

PARIS—France’s Atos SE ATO -13.05% made an unsolicited bid to acquire DXC Technology Co. DXC 9.30% , a Virginia-based spinout from what was once Hewlett Packard Enterprise that was valued at about $6.7 billion at Wednesday’s market close.

The French provider of IT services for businesses said Thursday that it had approached DXC to discuss a potential transaction. DXC said it had received Atos’s nonbinding bid to buy all of its shares on Wednesday evening.

Neither company disclosed the value of the offer, which DXC said it would evaluate. Atos said it would “apply the financial discipline which it has always followed,” and cautioned that there was no guarantee a deal would be reached.

Shares in DXC rose as much as 10% in early trading on Thursday. DXC was created in 2017 from the merger of Computer Sciences Corp. and the bulk of Hewlett Packard Enterprise’s tech-services business.

Shares in Atos, which offers services such as infrastructure and cloud applications for businesses, fell as much as 11% Thursday. Atos had been valued at roughly 8.3 billion euros, equivalent to $10.2 billion, at Wednesday’s close.

Together, the two rivals could be worth more than $16 billion, accelerating the French company’s race for size in the IT-outsourcing sector.

In the past year, Atos said it has made nine small acquisitions in areas including cybersecurity as well as cloud analytics. Until now, Atos’s biggest acquisition was a $3.4 billion deal in 2018 to buy Syntel, a U.S.-based rival that helped boost Atos’s presence in North America.

Atos’s approach comes as DXC has been selling off businesses to pay down debt and focus on its core technology offerings for enterprise clients.

In October, DXC closed a $5 billion cash deal with Veritas Capital to sell a unit that offers technology services to manage health and human services for U.S. states and localities. Over the summer, DXC said it had agreed to sell its health-care software provider business to Dedalus Group for $525 million.

Write to Sam Schechner at sam.schechner@wsj.com

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