SPECIAL FOCUS ON GREECE
Dec 12, 2008
- Greece
ANALYSTS CONCLUDE OPAP MONOPOLY ‘UNSUSTAINABLE’
OPAP ‘will lose its status as the world’s most profitable gaming company’
‘Supernormal’ profits unsustainable say Morgan Stanley in face of legitimate competition
Greek legislation not in line with EU law and subject to infringement proceedings by the European Commission
Leading investment bank, Morgan Stanley has concluded that OPAP’s monopoly position in Greece is unsustainable. Analysts at the bank state that OPAP faces a threat in the face of legitimate competition and the inevitable ending of its monopoly in compliance with EC law, bringing to an end its “supernormal” profits. This follows an attempt to justify OPAP’s position by its chief executive, Christos Hadjiemmanuil at an ill-tempered conference call with analysts.
According to Scott Langley at Gambling Compliance (www.gamblingcompliance.com):
“an ‘unsustainable’ monopoly position in its home market of Greece will see sports-betting operator OPAP lose its status as the world’s most profitable gaming company, according to analysis from the leisure team at Morgan Stanley. The Morgan Stanley analysts have OPAP as one of the bottom picks of the sector and suggested the company was an “anomaly” and that its “supernormal” profits were unsustainable being based on OPAP’s monopoly position… we believe that this monopoly will continue to come under further pressure over the next two years.”
In addition, the analysts suggested that there are further downside risks, including a weakening Greek economy and emerging competition in sports-betting which they believe will knock 3 percent off overall gross win. The analysts cited recent comments from the European Commission to the effect that Greek legislation on sport-betting is not in line with EU laws and that an infringement procedure has already been put in train.
Greek State employs strong arm tactics
At OPAP SA’s Q3 Investor Call on 25 November, CEO Christos Hadjiemmanuil stated that OPAP does not want “simply to behave like stupid policemen, breaking in and closing shops”.
Yet this exactly what happened to Stanleybet’s shops recently when OPAP asked the Greek Authorities to act against Stanleybet’s intermediaries and customers.
In direct contravention of EU law, on 6 November the Greek State closed Stanleybet International’s outlet in Athens, arresting their intermediary and on 8 November closed the Thessaloniki outlet, arresting three customers as well as Stanleybet’s intermediary. Both shops remain sealed by the authorities.
Adrian Morris, Director of the Fair Play for Sports Betting campaign said:
“Why the strong arm tactics? The rationale is not hard to find: it lies, of course, in the Greek State’s concern to protect the increasingly precarious monopoly position of OPAP. But the authorities do not have the courage to take the matter directly to court, as they know it is likely to be referred to the European Court of Justice and found in breach of European law.
“Here we have a peculiar, discriminatory situation where OPAP deploys the Greek State in persecuting ordinary citizens who enter a shop to bet, without taking similar action against all those who bet online. It is now vital that the European Commission urgently addresses this unlawful behaviour and specifically pursues the outstanding infringement procedure referring Greece to the ECJ.”
To view the Gamblingcompliance.com article, click here .
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