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France sells its lottery for $2 billion

France will bank 1.8 billion euros (US$2 billion) from selling down its stake in the country’s lottery operator, according to the final price set on Wednesday in a listing that will serve as a test for France’s privatization push.

President Emmanuel Macron’s pro-business government kicked off the biggest wave of privatizations in over a decade with the initial public offering (IPO) of Francaise des Jeux (FDJ), the organization that operates the country’s lottery. It is seeking to raise money for an innovation fund, to finance technology investments.

Finance Minister Bruno Le Maire confirmed on Wednesday that the IPO was priced at 19.90 euros per share for institutional investors, the upper end of the range the shares were offered at.

Some 500,000 retail buyers also placed orders in the listing, and will make up 40.5% of shareholders, the government said. Their shares included a discount, and were priced at 19.50 euros each.

Overall, investors placed total orders worth 11 billion euros, Le Maire said, calling the IPO a “considerable success”.

FDJ shares started trading on Thursday.

The flotation is one of the biggest in Europe this year, and comes after several other IPOs were cancelled or postponed due to investor jitters over Britain’s rocky EU exit and a simmering trade war between the United States and China.

The privatization will generate 2 billion euros in proceeds for state coffers when including a 380 million-euro payment the FDJ owes the state to retain its monopoly rights for its lottery and sports betting business.

The deal could yet embolden the government to press ahead with other big asset sales, although the more lucrative but politically trickier disposal of airports operator ADP is still hanging in the balance.

Opponents are calling for a referendum on that sale, with a petition to stop it that runs until March and which aims to garner the required 4.7 million signatures.

Le Maire said on Wednesday there were no other state assets earmarked for sale in the short term.

The French state will have 27.85% of the FDJ after the IPO, or 20% if an over-allotment option, which is there is to satisfy excess demand, is used.

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