French Gambling Giant FDJ Announces €1.5 Billion Bond Issuance to Refinance Kindred Acquisition
French gambling powerhouse La Française des Jeux (FDJ) has announced plans to issue bonds worth €1.5 billion on the Paris Euronext exchange. The bonds will be divided into three tranches with maturity periods set at six, nine, and 12 years, aiming to attract a diverse range of investors.
FDJ’s Strategic Move in Bond Issuance
This move is a part of FDJ’s broader financial strategy to secure long-term stability after its acquisition of Swedish igaming operator Kindred Group, a deal valued at €2.6 billion. The proceeds from the bond issuance will be directed toward refinancing a €2 billion bridge loan, initially secured to fund the acquisition. The repayment of these bonds is planned to be sourced from FDJ’s robust cash flow.
In addition to the bond issuance, FDJ is arranging a €400 million syndicated loan. This loan, backed by major French and international banks, is structured for repayment over a five-year period. The company has also scheduled meetings with investors to assess market sentiment and ensure favorable conditions for its financial instruments.
Earlier this month, Moody’s assigned FDJ a Baa1 long-term credit rating with a stable outlook, reflecting confidence in the company’s financial health and its ability to manage debt obligations. However, FDJ’s financial landscape faced a minor setback when the European Commission (EC) ruled that it must pay an additional €97 million for its exclusive lottery and retail sports betting rights in France.
The ruling followed two complaints to the EC, alleging that FDJ’s monopoly constituted illegal state aid. While the EC dismissed the claims of state aid, it concluded that the €380 million paid by FDJ for monopoly rights was undervalued.
FDJ’s Expansion and Revenue Growth
Over the past two years, FDJ has aggressively expanded its portfolio through strategic acquisitions. Notable deals include the acquisition of Premier Lotteries Ireland, operator of the Irish National Lottery, and Kindred Group, which owns the Unibet brand. These acquisitions have positioned FDJ as a global player in the gambling industry.
The company’s growth is evident in its financial performance, with Q3 revenue rising by 12% year-on-year to €2.09 billion.
Despite its international expansion, FDJ has expressed concerns about France’s potential plans to regulate online casinos. As a company deeply rooted in retail operations, FDJ may face challenges in adapting to new regulatory frameworks that could reshape the online gambling landscape in its domestic market.
