Tote sale price tumbles

Jul 22 2008 by Peter McCusker, The Journal

THE Government is preparing to put its Tote horseracing bookmaker business up for sale on the open market this autumn.

The Department for Culture Media and Sport (DCMS) said it had already taken steps towards an auction, even though the price tag is likely to be far less than the £400m it could once have fetched.

Sports Minister Gerry Sutcliffe stressed in a written statement to Parliament that no final decision had been made on whether a sale should go ahead, adding the Government needed to be certain it was right to offload Tote “in the light of current market conditions”. Reports suggest that investment bank Goldman Sachs, which was hired in April to advise on the sale, has valued the 529 betting shops and pools business at between £260m and £290m amid the current economic climate.

The price, much less than the £400m bid submitted last year by a consortium of racetrack owners, was turned down by the Government because it was backed by private equity.

The consortium’s second attempt at securing Tote without support from private equity was then rejected for being too low, at a reported £320m.