Government to call a halt to Tote sell-off
The Government is expected to shelve plans to sell off betting business, the Tote. Sports minister Gerry Sutcliffe is set to make an announcement imminently.
It is thought that a report from advisers Goldman Sachs will indicate the state-owned business is worth much less than the £400m the Government had hoped for and will force Sutcliffe to abandon plans for a sell-off. Industry observers claim the business would fetch no more than £280m, in the current economic climate.
In March, Sutcliffe appointed Goldman Sachs to look at strategic options for the sale of the bookmakers. The move came after Sutcliffe formally rejected a bid of £320m from a racing industry consortium, made in September last year (MW March 5).
Goldman Sachs has received expressions of interest from around 40 potential bidders for the business, which has 540 betting shops as well as racecourse pool betting kiosks, which, some speculated, could be sold separately. Gala Coral chief executive Neil Goulden and Fred Done, head of the BetFred bookmakers chain, both indicated they planned to make a bid.
The delay will bring further uncertainty to the Tote and its 19,000 employees. A sell-off was first mooted in 2001 as part of Labour’s manifesto. An initial plan to hand the business to a racing industry trust fell foul of European Union rules.
A bid from a racing industry consortium, meeting the £400m price tag, was refused by the Treasury, as it was part-backed by private equity. A revised bid of £320m was rejected in March.
The DCMS declined to comment but said a statement would be made “very shortly”.
