France sees 2 bn euro payoff as lottery IPO launched
France's state-owned lottery monopoly kicked off its shift to private hands Thursday, opening the sale of shares in the company that is likely to bring nearly two billion euros ($2.2 billion) to government coffers.
The Francaise des Jeux (FDJ) set the indicative price for shares in the operator of 16.50 to 19.90 euros, which would value the company at up to 3.8 billion euros.
The initial public offering of the 52 percent stake aims to rekindle demand for stocks among French savers, many of whom have stuck massively with ultrasafe but low-interest savings accounts since the 2007-2008 financial crisis.
"It's an opportunity to renew interest in the market with a simple product. When you're an individual, you need to invest for the long term," FDJ's chief executive, Stephane Palloz, told BFM television on Thursday.
"We offer an attractive yield for a less risky product," she said.
Around a third of the offering will be reserved for private investors, who will get a free share for every 10 bought if they hold them for at least 18 months.
The subscription period runs to November 20, and trading will begin the next day.
France is one of few countries to enable such investment opportunities for individuals. Would-be investors in most other countries have to wait for the first day of public trading to buy.
Prime Minister Edouard Philippe's government has vowed to partially privatise a number of entities, including the airports operator ADP and the energy behemoth Engie, to feed a 10 billion euro fund to kickstart technological innovation.
FDJ came into being as the successor of a national lottery founded in 1933 to help soldiers disfigured in World War I and struggling farmers.
It is a comparatively rare case of a French public enterprise in robust financial health, and is well known by the public, who made 16 billion euros' worth of flutters on assorted games of chance last year.
It is the second-biggest betting company in Europe and the fourth in the world.
The state will retain a 20 percent stake in the company, and will benefit from a yearly public contribution of some 3.5 billion euros, as well as a 380 million euro annual payment for a 25-year monopoly license.
But critics and opposition parties have assailed the move to offload a rare money-making state enterprise, saying it is tantamount to selling off "the family jewels".
© 2019 AFP