Bid for Tote 'short of £400m target'

A horse-racing industry consortium has made a formal bid for the Tote, the British government-owned bookmaker, below its £400m (€594m) price tag, it was reported today.

The offer could prompt the British government to consider an alternative sale.

Labour made a manifesto pledge before the last general election to sell the Tote, which relocated from Putney to Wigan last year and has 540 betting shops, to the racing industry.

Early last year it was hoped it would be bought by the Racing Trust, which was made up of racecourses, owners, the British Horseracing Board, the BHB Industry Committee and the Jockey Club, but the move was blocked by the European Commission.

Since then accountant Price Waterhouse Coopers has been working on the sale and is thought to have come up with the £400m (€594m) valuation.

A consortium consisting of racecourse owner Arena Leisure, Racecourse Holdings Trust – the arm of the Jockey Club that owns Aintree and Cheltenham – and the Racehorse Owners Association, has been working on a bid for several weeks, according to the Sunday Telegraph and Sunday Times.

It is understood the offer was some way short of the £400m (€594m) the British government hoped to achieve with analysts pointing to a figure of above £350m (€519.86m).

A spokeswoman from the Department of Culture, Media and Sport confirmed a racing consortium had tabled an offer.

“We are talking to a racing consortium about the sale of the Tote for its full-market value,” she said but could not give further details. The British government has never revealed the amount it is asking for.

Some believe it will now look to sell the Tote on the open market.

Although the UK’s two largest bookies, Ladbrokes and William Hill, would be prevented from bidding on competition grounds, the next largest chain Gala Coral, is understood to be interested.

Operating profits fell 3.3% to £23.4m (34.76m) last year because of poor horse-racing results while turnover grew 16.9% to £2.21bn (€3.28bn) as more punters gambled more money.