French gambling giant FDJ to launch bonds worth €1.5bn

The FDJ bonds will be issued in Paris in three tranches.

France.- The French gambling giant La Française des Jeux FDJ has announced that it will issue bonds totalling €1.5bn on the Paris Euronext exchange. The bonds will be issued in three tranches with maturity dates of six, nine and 12 years.

The proceeds raised from the bond issue will go towards refinancing a €2bn bridge loan that FDJ secured to cover its €2.6bn acquisition of the Swedish igaming operator Kindred Group. It will repay the bonds using cash flow.

The company, which runs the French national lottery and used to be a state-owned monopoly, will meet with investors in the coming days to gauge market sentiment. FDJ is also arranging a €400m syndicated loan from major French and international banks. It will repay the loan over five years.

Earlier this month, Moody’s gave FDJ a long-term credit rating of Baa1 noting a stable outlook. Meanwhile, the European Commission (EC) ruled that the company should pay an additional €97m for its exclusive lottery and retail sports betting rights in France.

Two complaints to the EC had argued that the French government’s decision to allow FDJ’s monopoly to continue constituted illegal state aid. The EC ruled this was not the case, but decided that the €380m that the FDJ paid for its monopoly rights was too little.

FDJ has been expanding aggressively with a series of major acquisitions in the last two years, including the Irish National Lottery operator Premier Lotteries Ireland and the Swedish online gambling operator Kindred, owner of the Unibet brand. Revenue in Q3 rose by 12 per cent year-on-year to €2.09bn.

Despite its acquisition of Kindred, FDJ has raised concerns about plans to regulate online casino in France.