Acquisition Bid Fails

The Government has confirmed that it has rejected a bid from a racing consortium for the Tote, and that the state-owned horseracing bookmaker will now be sold on the open market.

The bid team's offer - which includes Tote bosses - failed to match the Government's £400m price tag.

Sports minister Gerry Sutcliffe confirmed that the offer had been declined with "great regret" and said that he is appointing advisers to prepare for an open market sale.

The Tote, which is based in Wigan, employs more than 4,000 staff and has 450 betting shops. The Labour Party first committed to sell it in 2001 to end the Government's direct involvement in horseracing.

Mr Sutcliffe said that if a deal was done at the consortium's price - a reported £320m - it would have breached European state aid rules.

The Government is keen to generate the biggest possible returns for taxpayers, which may mean it keeps hold of the business until the current squeeze in debt markets which has hit deal-making eases off.

Betting chain Coral and the racehorse-owning head of stockbroker Cenkos Securities Andy Stewart have already been linked with making a possible bid for the Tote in an auction.

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Kevin Cunningham from law firm Irwin Mitchell said: "Lenders are giving more scrutiny to deals and taking longer to give credit approvals. In the current climate, sellers need to have sensible price expectations and they can expect deals to take longer to conclude."