Analysts expect Atos to come back with a better deal. Gemalto has also not closed its doors to any further deal.

On Thursday, with Franco-Dutch chip maker Gemalto rejecting Atos $5 billion (4.3 billion euro) takeover bid, shares of Atos fell sharply by as much as 2.8%.

On the French blue-chip CAC 40 index, early on Thursday, shares of Atos led losers early on.

On Wednesday, Gemalto, the world’s largest maker of chips found in mobile phones and credit cards, had said, Atos’ offer had cited undervaluation as the prime reason for its rejection.

Reversing early gains, Gemalto’s shares were marginally down by 0.50%.

As per Philippe Cohen, fund manager at Kiplink Finance, Atos is likely to sweeten the deal.

“Atos started with a low price, which is logical in this type of negotiations. There’s also the scenario of a ‘white knight’, probably French, such as Thales for example,” said Cohen. “But the most likely scenario for us is that Atos raises its offer”.

In an interview with Les Echos, a French daily, Philippe Vallee, Gemalto’s CEO had said Atos’s strategy for the group was “unconvincing” and that it had “significantly” undervalued its valuation in its bid; however he has not rejected the deal in its totality.

“We had to respond to this offer,” said Vallee to Les Echos.

When asked if Gemalto would reconsider its decision if Atos were to respond to its concerns, Vallee said, “Our answer is clear. I can’t foresee the future.”