Paddy Power expands into France

PADDY Power has formally announced its expansionin to the French online betting market, through a tie-in with PMU (formerly the Pari-Mutuel); the largest betting organisation in Europe and the second largest worldwide.

The move into France is in line with Paddy Power’s aggressive international expansion plans (it is aiming to increase its online market share in Britain, has recently entered the Australian market and is keeping an eye on market deregulation talks in the US.

The deal with PMU will see the Irish company provide risk management, event management and fixed odds pricing services for the French firm’s online services. It will be for an initial five-year period, beginning during the first half of next year.

Patrick Kennedy, Paddy Power’s chief executive, said that the company would continue to look for other quality opportunities in international markets.

Despite its overseas plans, however, it is thought the company will focus, in the near-term, on Britain and France and is not immediately interested in markets such as India, where the first tranche of online gaming licences have recently gone to tender.

Mr Kennedy added that 250 high-end jobs would be created by the company, at its Tallaght-based headquarters, covering this latest deal and other services. Fifty of those jobs are to come on stream by next June, with 200 extra positions likely to be filled over the course of the next three years.

“Our partnership with PMU further confirms our ability to build a leading international business out of Dublin, sustaining and creating Irish jobs,” he said.

The French move is likely to show modest benefit to Power’s profits next year and grow thereafter.

Paddy Power’s share price soared by 9.42% (€2.10) yesterday to close at €24.40 on the back of the deal news and an upbeat trading update.

Within that update, the company said that it remains confident of meeting current market consensus for this year of 113c in diluted earnings per share. It added that, during the 19-week period to November 10, turnover grew strongly on the back of continued market share growth.

It added that growth in its retail division has been boosted by expansion in the British market.