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LONDON, Feb 20 (Reuters) – Hedge fund manager Christopher Hohn has written to Airbus (AIR.PA) demanding it drop a deal to purchase a minority stake in French IT consulting firm Atos’ (ATOS.PA) soon-to-be spun-off division Evidian.

In a public letter to the planemaker on Monday, Hohn said that Evidian was a “highly levered company” and investing in it would “dilute the quality of Airbus’ business.”

Hohn, who runs hedge fund TCI Fund Management, owns over 3% of Airbus’ shares worth more than 4 billion euros ($4.3 billion), the letter said.

The letter was first reported by the Financial Times.

France-based Airbus has submitted an offer to Atos’ board to acquire a 29.9% stake in Evidian, but will also perform an “in-depth due diligence period and will refine the details of its potential agreement with Evidian,” an Airbus spokesperson said, without directly commenting on the criticisms in the letter.

The indicative offer is short of the 30% threshold that would automatically trigger a full bid for Evidian.

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“There can be no certainty at this stage that a transaction will occur,” the spokesperson added.

If successful, the deal would give Airbus some say over Evidian, which groups Atos’ most coveted assets such as cybersecurity division BDS and supercomputers.

Atos, whose clients include France’s administration and army, would in return secure much-needed investment from a European industrial group as it strives to carry out its split-up plan after a troubled period marked by a governance crisis, heavy losses and sharp stock price swings.

Hohn, in the letter, said if the deal goes through Airbus should disclose what it would spend to pay down any debt or other liabilities of Atos.

Airbus shares were down 2% in afternoon trading, while Atos’ shares were down 0.3%.

($1 = 0.9359 euros)

Reporting by Nell Mackenzie, additional reporting Mathieu Rosemain; editing by Dhara Ranasinghe and Mark Potter

Our Standards: The Thomson Reuters Trust Principles.

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