SSSB still upbeat on OPAP

Schroder Salomon Smith Barney (SSSB) retained its «outperform, medium risk» rating on OPAP, the Greek soccer pool and lottery organization, after Greece confirmed plans to sell up to 25 percent of the company. SSSB said in a note that OPAP’s share weakness following the news of the planned offering was exaggerated and that the share offered value at a price that was 9.6 times the expected 2003 earnings per share. OPAP’s shares rose 2.39 percent to 7.72 euros yesterday after they fell to a 52-week low of 7.28 euros a day earlier. «We believe OPAP offers significant defensive cash-driven qualities, which the market has recently overlooked… OPAP’s sustainable dividend yield of 8.8 percent for 2002 is still by far the highest in its sector,» SSSB said. A Greek Economy Ministry official on Wednesday confirmed for the first time plans to sell up to 25 percent in OPAP but said the timing would depend on market conditions and how the war in Iraq develops. The investment bank said the government ideally needed to resolve the company’s arbitration with gaming systems operator Intralot before proceeding with any sale. In January, OPAP said it would challenge an arbitration court ruling award of 37 million euros ($39.9 million) per year to gaming systems operator Intralot for delays in launching betting games Intralot would have developed, including betting on greyhound races abroad. The State, which owns about 75 percent of OPAP, backed the move. (Reuters)