Bookmaker to stay British
As the saga of the sale of Tote continues, the government have ruled out the possibility of foreign investment, spoiling any interest Australia’s Tabcorp Holdings and South Africa’s Phumelela had in the state-owned bookmaker.
The Government pledged to sell the company to the racing industry earlier this year, though a racing consortium failed to meet a valuation set by the European Commission. The government later had the company valued by PricewaterhouseCoopers at around £400 million and essentially began an auction.
The racing consortium, made up of the Racecourse Holdings Trust, the Racecourse Association and The Racecourse Owners Association, had hoped to make up the difference through foreign financial backing. The latest news now appears to offer other interested parties further incentive to make a bid for Tote. Interactive Gaming Holdings, headed by Tote’s former chief executive John Heaton, Gala Coral and Tote’s present management are all said to involved in discussions.
Tote’s management have pressed the government to sell the business to an employee trust, although it is still believed the government want to give a contribution to the racing industry. However, if a management-led bid was successful, it would be largely financed by debt, which has caused much apprehension in the industry, fearing the detrimental affect it may have on the sport.
Gala Coral have stated that they are prepared to pay £405 million for the whole company, or £325 million for just its betting shops. The latter would then allow the government to pass on the remainder of the business to the racing industry, though it is thought this possibility has been muted.
The sale of Tote now appears to be reaching its culmination and it will be interesting to see if the government sticks to their manifesto of selling some, if not all of Tote, to the racing industry.
"We'll announce very soon how we intend to pursue the Tote sale," said a government spokesman.
Editor, Jackpot.co.uk - 2006-12-12 11:25:45