* Greece sells controlling stake in gambling firm OPAP
* Buyer, Czech-Greek fund Emma Delta, to pay 652 mln euros
* Price is at a discount to market value
(Adds completion of deal, comments by privatisation agency,
By Angeliki Koutantou and Harry Papachristou
ATHENS, May 1 Greece has secured the first of
the privatisation deals required under its international
bailout, with the sale of its 33 percent stake in betting firm
OPAP to a Greek-Czech investment fund.
The Emma Delta fund will pay 652 million euros ($860
million) for the stake plus management rights in the company,
privatisation agency HRADF said in a statement on Wednesday.
Athens' total receipts from the sale will rise to 712
million euros after it gets 60 million euros in dividends that
the state retains under the terms of the deal.
But the overall price the sale fetched was still below the
company's market value, highlighting the challenge Athens faces
in trying to meet its ambitious privatisation targets.
OPAP, which has monopoly rights for sports betting until
2020 and lottery operating rights until 2030, used to be
Greece's most profitable company.
The 33 percent stake had a market value of 745 million euros
based on OPAP's share price of 7.08 euros on April 22, when Emma
Delta, the sole bidder, submitted its initial offer.
Emma Delta is controlled by Czech investor Jiri Smejc, who
specialises in emerging markets, and George Melisanidis, the son
of well-known Greek shipping tycoon Dimitris Melisanidis.
Smejc, 42, has investments in Russia, China and South-East
Asia. Other fund investors include Greek entrepreneur Christos
Copelouzos, Russian investment firm ICT Group and Czech-based
investment fund KKCG.
Better-known prospective buyers for the OPAP stake dropped
out before the final bidding last month, including German gaming
equipment firm Gauselmann, gaming software group
Playtech, private equity firm BC Capital and Chinese
But HRADF said the sale price was good, at almost 19 times
the company's expected 2013 profit.
"The price was outstanding," the agency's chief executive
Yannis Emiris told Reuters. "It gives us a huge boost for the
privatisations to follow," he added.
OPAP's shares last traded on Tuesday at 7.49 euros, a
multiple of 16.64 times the average market forecast for earnings
this year of 0.45 euros, according to Thomson Reuters data.
OPAP used to be Greece's most profitable company with net
income exceeding 500 million euros last year. But this will
change after the cash-strapped government slapped a 30 percent
tax on gross gaming revenues from January this year.
On top of that, the company's expansion plans in electronic
and online games and video lotteries might come to nothing if
competitors such as William Hill and Stanley Bet succeed
in a court challenge to its sports betting and lottery monopoly
"The discount reflects the country risk and the challenges
regarding OPAP's monopoly and the roll-out of the
videolotteries," said Eurobank Equities analyst Stamatis
Emma Delta initially offered 622 million but Athens gave it
until Wednesday to improve its offer to at least 650 million as
it sought to keep the sale process on track. The extra 30
million euros offered will be paid in tranches, HRADF said.
"Emma Delta knew they were the sole bidders and that the
privatisation had to succeed, so there was no reason for them to
offer more than that," Draziotis added.
Greece's main opposition party Syriza called the
privatisation a sell-out.
"This tender is a parody. It ended up as a humiliating offer
by one bidder and shows that state property is not being sold
but is given away for free," Syriza said in a statement.
Athens needed to wrap up the sale to show it is finally
making good on long-promised efforts to sell off state assets
and cut its debt as demanded by its European Union/International
Monetary Fund bailout.
"Our expectations may not have been met in full but it's
nevertheless an important success because it is the first major
privatisation and paves the way for the others", an official
close to the government told Reuters.
If Greece had failed to sell OPAP it would have already
missed its asset sale target of 2.6 billion euros ($3.4 billion)
this year - a shortfall it would have to meet with additional
austerity measures or more money from its international
Greece might still miss the target if it settles for less
than expected in its next big privatisation sale due later this
month, of gas utility DEPA.
The DEPA sale has failed to attract major western energy
companies, leaving Russia's Gazprom as the sole
(Editing by Greg Mahlich)