As Cameron loses biggest gamble, Johnson looks biggest winner

(Repeats story first issued on June 24)

By Elizabeth Piper

LONDON, June 24 (Reuters) - It was David Cameron's biggest gamble and he was convinced he would win. Now, the British leader's closest rival - in the EU referendum, in the Conservative Party and in the country - is the frontrunner to take his job.

Britain's decision to leave the European Union, a victory for the populist cause, may be a defining moment for Britain and the European project. On Friday, it sent shares and the sterling currency sharply lower amid warnings of damage to the economy.

The one man to ascend is Boris Johnson, the former London mayor and schoolmate of Cameron's who became the household name of the "Out" campaign even as the prime minister battled for "In".

With Cameron's announcement that he will resign after the British public voted against him, Johnson is now the strongest candidate to replace him.

But the moment of victory is fraught with challenges - first he will have to convince Conservative lawmakers to back him and then persuade the party's largely eurosceptic wider membership, who may challenge what his critics call a record of changing his views to suit his audience.

For Cameron, the turning point came in February when Johnson, a politician who has built a broad appeal beyond the ruling Conservative Party, threw his support behind the "Out" campaign in what several sources say was a calculated move to boost his chances of replacing the prime minister.

Cameron gave in to vocal eurosceptics in his party in early 2013 to put Britain's EU membership to the public vote. It was an attempt to bury the question of Britain's EU membership that has bedevilled successive governments.

Initially, Cameron thought he could woo Johnson to his side. A friend and former colleague of Johnson said the former mayor could have been guaranteed a position in Cameron's cabinet - or group of top ministers - had he agreed to campaign alongside the prime minister.

Instead he lent his support, and with it his broad popularity among voters, to the "Leave" campaign.

"He is such an asset to that campaign, he made it optimistic, energetic and positive," the friend told Reuters.

CAMERON MIS-STEPS

Aides to the prime minister said Cameron believed he could have easily won the fight to keep Britain in the EU if he had had the support of Johnson, who used his position as mayor of London between 2008 and 2016 to broaden his appeal beyond the Conservative Party by supporting gay rights and immigration.

The prime minister already had the weight of expert opinion in big business, entertainment and sport from across the country and beyond. These groups had been carefully polled and aides had held numerous focus groups that indicated that the "out" campaign could win only 42 percent of the vote by arguing solely on immigration.