FDJ Responds to Market Concerns Over Possible Gambling Tax Hike
French gaming giant La Française des Jeux (FDJ) has moved to calm the market after reports emerged that the French government was considering raising taxes on gambling in 2025. The speculation sent FDJ’s stock price tumbling and the company has released a statement.
FDJ Says No Tax Hike
FDJ denied the reports saying that to their knowledge the forthcoming Social Security Finance Bill (PLFSS) will not include any new tax measures on gambling.
“To our knowledge, the PLFSS (Social Security Finance Bill), which will shortly be presented to the Council of Ministers, will not contain any tax measures concerning gambling” the company said.
This was in response to media reports that the government wants to increase gambling taxes to fund the Social Security.
Market Moves
Despite the denial FDJ’s stock went down as investors reacted to the potential regulatory changes. On October 2 FDJ’s share price closed at €36.78 ($40.36) and the next day it fell 6.4% to €34.44 by close of trading.
Lucas Excoffier, European equity trader at Oddo BHF Corporate & Markets, believes FDJ’s statement was based on high level discussions with the French Ministry of Finance.
“The market reaction is very severe, even though this type of news of course feeds the risk of regulation on the gaming sector, in particular FDJ.”
FDJ’s Moves Amid Market Volatility
Despite the market fluctuations FDJ is moving ahead. On the same day the stock went down FDJ completed its tender offer for Kindred Group and acquired 90.66% of the company’s share capital. The €2.5 billion ($2.7 billion) deal will allow FDJ to launch a squeeze-out procedure on Nasdaq Stockholm and buy the remaining shares and consolidate its control on Kindred.