Lyon score with share launch

Demand for the first French professional club to list shares was particularly strong from institutional investors in Britain where football clubs have long been high-profile companies on the stock exchange.

The stock was ahead by 0.79% in mid afternoon trading.

"It's a new era for Lyon and all French sports clubs," Lyon president and controlling shareholder Jean-Michel Aulas said at the Lyon stock exchange as the first exchanges flashed up on a giant screen in the trading room.

Lyon, which has dominated French soccer over the past decade winning the last five league titles, plans to use the money to build a new stadium and shopping complex.

The club is the first in France to seize an opportunity opened up by European Union authorities which pressed France to allow teams to raise funds through the stock market in line with EU open market and competition principles.

The French government was reluctant, arguing that once a club had stock quoted assets its exposure to commercial pressures which could influence the ethics of sport, or even the outcome of games, might be compromised.

'Only solution'

Until now, clubs have been financed by a variety of means such as private, but non-quoted finance, municipal or regional funding, lottery money or sponsorship.

Aulas said that the flotation had been "the only solution to try to catch up the delay which French football clubs had built up compared with European clubs".

He said on French RTL radio: "All other countries have this access to private finance and then this will open the way to the construction of some private stadiums.

"We know today that the equipment in French stadiums is extremely behind. For the country, it is a fantastic opportunity to put the construction of top quality stadiums in the private sector."

Lyon, a group with a variety of commercial interests, has shot to prominence in France in the last decade with the five title wins, but has found success on the lucrative European Champions League stage to be elusive.

The company sees a stock quotation as a way of raising its profile, as well as capital, to match the business prominence of quoted clubs such as Manchester United and Liverpool in Britain.

The price of the shares hit a high of €26 in early trading before falling back to €24.19, a rise of 0.79% from the starting price.

Ranked 11th richest club in the world

The French side play AS Roma of Italy in the last 16 of the European Champions League tournament. It has insisted however that a stock issue was the "only" way to catch up with the financial power of other top European teams.

According to an annual ranking of the world's wealthiest clubs released this week by accountants Deloitte, Lyon were the richest French club but ranked only 11th in the world.

Lyon issued 3.6 million shares worth about €88.4m euros, the Euronext stock market operator said, valuing the entire group, known in France under the letters OL, at €312m.

Aulas, who fought hard to turn the change in the law into a change in financial practice, wants to raise a total of €100m to build a 60 000 seat stadium and a shopping complex costing €250-300m.

He said that the shares had been bought heavily by investors in Britain.

A source close to the club said that about a third of 139 institutional investors were believed to be based in Britain. Ten percent of the issue had been reserved for small investors of whom 14 000 had subscribed.