Tote sale facing further delays

The drawn-out sale of British state-owned horseracing bookmaker the Tote looked to have suffered a further delay today after a crucial Government meeting on the £400m (€588.75m) deal was cancelled.

The British Treasury and the Department for Culture Media and Sport (DCMS) were set to meet in what is thought to have been an attempt to get the fated deal back on track.

But sources close to the process said a "diary clash" between Sports Minister Richard Caborn and Stephen Timms, chief secretary to the Treasury, saw the meeting postponed with little sign of it being rescheduled any time soon.

The Treasury remained tight-lipped, saying only that it "does not comment on meetings".

The deal put forward by the group, comprising racecourse owners, Tote management and staff, was said to be on the brink of collapse earlier this month.

Reports have suggested the Treasury was unhappy with the heavy gearing of the deal, which includes a significant amount of debt from backers Lloyds TSB-owned private equity firm LDC, and was concerned that the final bid structure did not adequately represent the racing industry.

There was also no mention of the expected £400m (€588.75m) windfall from the sale in February's Budget.

The consortium, which includes the Racehorse Owners Association, the Racehorse Association (RCA) and Tote bosses, put in its bid at the start of the year.

A spokesman for the Jockey Club Racecourses, the then Racecourse Holdings Trust which led an earlier failed bid for the Tote, said: "A bid was put forward in January and nothing has been heard since from Government. It's been a drawn-out process right from the very beginning, dating back several years now."

Stephen Crown, president of the Racehorse Owners Association, added that they would "like to have heard back on it by now".

The British Government made a manifesto pledge to sell the Tote to the racing industry before the last General Election, but so far efforts to sell the bookmaking business have hit the rocks.

Plans by a horseracing consortium to buy Wigan-based Tote were thwarted last September after the DCMS, which is overseeing the sale process, failed to reach an agreement with the group.

The European Commission also blocked a move to sell the Tote in early 2005 on the grounds that the price tag was too cheap and was effectively "state aid".

The Tote has 540 betting shops and reported a 3.3% fall in operating profits to £23.4m (€34.4m) in the year to March 31, 2006, although turnover grew 16.9% to £2.21bn (€3.25bn) as more punters gambled more money.