Greece Gambling Monopoly Hurt by Recession

ATHENS (Reuters) – Greece’s OPAP, one of Europe's biggest betting firms, reported a 16 percent fall in third-quarter profit on Tuesday, weighed down by the recession in its Greek home market.

Cash-strapped Greece’s plans next year to sell almost its entire 34 percent stake in OPAP, its most profitable company, as part of its international bailout agreement. But higher taxes and doubts about OPAP's most precious asset, its gambling monopoly, may undermine the company's value.

Revenues dropped 11 percent to 891.3 million euros ($1.14 billion) as the country's worst recession since World War Two dampened punters' gambling appetite.

Net profit stood at 113.6 million euros, down from 135.4 million euros a year earlier but above an average forecast of 108.9 million euros in a Reuters poll of analysts.

Eight potential investors, including a Chinese conglomerate and big private equity funds, have expressed interest in buying a 33 percent stake in OPAP, which has a total market value of about 1.5 billion euros on the Athens Stock Exchange.

However, OPAP's profitability will suffer next year after the government decided to impose a 30 percent levy on the company's gross earnings from Jan. 1.

The company's sports betting monopoly may also be repealed after potential competitors, including Britain's William Hill , challenged it in court.

Despite the challenges facing the company, its chief executive said on Tuesday that he was optimistic about its prospects now that uncertainty around taxation had been settled.

OPAP is expanding into online gaming and video lotteries and is a candidate to buy a Greek state lottery this year.