Statement on the future of the Tote
110\2008
22 October 2008
The Government today announced that due to current market conditions it will not proceed with the sale of the Tote this Autumn.
In a written statement to Parliament Minister for Sport Gerry Sutcliffe said:
“In my Ministerial Written Statement on 21 July I said that, whilst the Government remained of the view that it should remove itself from detailed involvement in the affairs of the racing and bookmaking industries, the Government would need to be satisfied that it was right to proceed with a sale in the light of prevailing market conditions.
“After further work over the summer, I have now concluded that it is not appropriate to pursue a sale in these market conditions. I have therefore decided that the Tote should be retained in public ownership for the medium-term, and brought to the market when conditions are likely to deliver value for the tax payer and racing.
“Finally, the Government would like to place on record again its warm appreciation of the loyalty and dedication of the Tote’s staff whilst its future has been under consideration.”
He later added:
“It is right that the Tote is now given time to grow the business so that any future sale will achieve maximum value. In particular, I would expect the Tote and racing to continue to work closely together for the benefit of the sport and the punter.”
Notes to Editors:
The Government took powers in the Horserace Betting and Olympic Lottery Act 2004 to enable it to sell the Horserace Totalisator Board (“The Tote”) as part of its wider policy aim of removing itself from detailed involvement in the affairs of the racing industry. Since then it was in a period of exclusive negotiation to sell the Tote to racing until March this year.
The Government’s initial intention was to sell the Tote to a racing trust in 2005 at a fair price until it became clear that a sale on that basis risked being denied approval under European state aid and competition rules, because it would have been below open market value. The Government subsequently appointed independent advisers to assess market value and sought unsuccessfully to achieve a sale on that basis to racing in 2006. Finally the Government, responding to representations from racing and the Tote itself, sought during the course of 2007 to achieve a sale to racing interests and the staff and management of the Tote.
The Government received an offer for the Tote in January 2007 but the final offer, subsequently received in September 2007, did not meet the independent assessment of the Tote’s market value undertaken for the Government and which was necessary for a sale to proceed lawfully under EU state aid rules. So in March 2008 the Government announced that it would move to a sale on the open market and began preparations for that sale.
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