Fdj: A sale of shares by Crédit Agricole puts FDJ shares under pressure

(BFM Bourse) – Crédit Agricole Assurances, the insurance subsidiary of Crédit Agricole SA, sold 2.2% of the capital of the gambling operator at a price of 36.60 euros per share. Which represents a discount of 7% compared to Wednesday's closing price.

Crédit Agricole Assurances has decided to take part of its profits from FDJ. The gambling operator constitutes one of the good surprises of the Paris Stock Exchange this year, with an increase of more than 14% over the whole of 2024, when its reference index, the SBF 120, loses 4 %.

The insurance subsidiary of Crédit Agricole SA decided that it was time to monetize part of its stake. Crédit Agricole Assurances announced on Wednesday that it had sold, via an accelerated order book, 4.073 million FDJ shares, or approximately 2.2% of the capital, at a unit price of 36.60 euros.

Which represents a total amount of 149 million euros. Above all, the unit price of this placement reflects a discount of around 7% compared to the closing price on Tuesday evening (39.34 euros).

As a result, the FDJ share suffered on the Paris Stock Exchange this Wednesday, its price approaching the unit price of this investment. The stock thus lost 4.5% around 10:40 a.m., showing one of the biggest drops in the SBF 120.

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Taxation and end of the European Commission investigation

Following the placement, Crédit Agricole Assurances will still hold 3.3% of the capital and 4.5% of the voting rights. The insurance group has been a shareholder of FDJ since its IPO in 2019.

Remember that the news has been very busy in recent weeks for FDJ. The group led by Stéphane Pallez delivered a good third quarter, marked by a robust lottery performance.

Above all, at the end of October, a major threat was erased, with the outcome of the European Commission's investigation into the allocation of exclusive rights (therefore the monopoly) by the French State to the group on lottery and betting physical athletes.

The verdict of this investigation, which lasted more than three years, resulted in an additional price of only 97 million euros for FDJ, far from what the market had feared. In 2022, Citi bank had mentioned a potential amount of more than 1.5 billion euros.

Furthermore, investors feared that the Social Security financing bill for 2025 would increase taxes on gambling. The draft itself does not contain this measure. An amendment tabled at the end of October by the government to the text, however, proposed increasing social security contributions on several types of games, in particular horse racing and sports betting. But the lottery, the heart of the FDJ results reactor, was spared. And this amendment was anyway rejected in session at the National Assembly during the first reading of the bill.

Julien Marion – ©2024 BFM Bourse