France could raise €15bn from shares offering

The French government will begin laying the groundwork this month for the sale of shares in energy provider Engie, airport operator Aeroports de Paris and lottery company Francaise des Jeux, potentially raising as much as €15 billion (Dh64.92bn).

Proposed laws clearing the way for the sales will be presented to the cabinet on Monday, government officials said in a briefing late Tuesday.

The measures aren’t expected to pass Parliament until early 2019, and the timings and terms of the sales have yet to be decided, they said. The proceeds would go to reducing the state’s debt and bulking up a government fund to invest in innovative technological and industrial projects.

“We’ll decide when the moment comes, but it all depends on market conditions,” Finance Minister Bruno Le Maire said in an interview with Les Echos.

“The state’s stakes in these companies represent about €15bn that are now immobilised and which would allow us to invest in our future.”

For President Emmanuel Macron, the state’s stockholdings give him financial firepower while helping him to live within European Union budgetary rules. The nation is unusual among big Western European countries in that it has a broad portfolio of stakes in publicly traded companies, in addition to closely held businesses such as military shipbuilder DCNS and Francaise des Jeux. While Mr Macron considers investments in defence and nuclear companies to be strategic assets that won’t be sold, others are fair game for divestment.

The bill going before lawmakers would eliminate a requirement for the state to hold more than 50 per cent of ADP and onethird of the voting rights in Engie, both of which are listed on the Paris stock market.

In the case of Francaise des Jeux, which isn’t listed, a new gambling regulator must be established before the company can be privatised.

The measures won’t be debated in parliament until after the summer holidays.

ADP, which is now 50.6 per cent government owned, will be given a 70-year lease on land and management of Paris airports, after which these will revert to the state, a Finance Ministry official said.

The government will maintain a veto over sales of the real estate at Orly and Charles De Gaulle airports. The government will also have a right to block any sales of Engie’s strategic gas storage and transport infrastructure, the official said.

Vinci SA, the construction and infrastructure company that owns 8 per cent of ADP, has said it’s interested in increasing its stake should the French state sell shares.