Archos: capital increase launched, share price declines

(CercleFinance.com) - On Monday, Archos announced the launch of its ?1 million capital increase, an operation which comes at a time when the French group is finalizing its transformation.


However, this announcement caused the share price to plunge by more than 7% on Monday morning, making it one of the biggest decliners on the Paris market at the start of the week.

The issue of new shares with shareholders' pre-emptive rights will be based on a unit price of 0.043 euros per share, with a parity of 10 new shares for every 15 held.

The management team has committed to more than half (51.7%) of the capital increase, with the aim of building a "core group" of shareholders, putting an end to alternative financing and halting dilution.

However, the subscription price shows a 38.7% discount to the last quoted price, with a dilutive effect that looks set to be significant.

A shareholder who held 1% of the capital before the capital increase and did not subscribe to it would thus see his stake reduced to 0.6%.

The capital increase comes at a time when Archos says it is now focused on its strategic plan, centered around its consumer division (new Android tablets), its professional and defense division (Logic Instrument and Elexo) and a healthcare division focused on four 'medtechs'.

With the end of recourse to convertible bonds and dilutive instruments, the Group expects to achieve sales of ?40 million and profitable Ebitda in 2024, before exceeding sales of ?50 million in 2025, while significantly improving profitability.

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