Insider Media Limited

Gala Coral, the Nottingham-headquartered bookmaker, is thought to be amongst the final six shortlisted suitors selected by the government to purchase the Tote bookie chain. John Penrose, minister for tourism and heritage, revealed yesterday that “a selected number of parties” had progressed to the next round of the bidding process. Despite a £188m deficit in revenue, Gala Coral is rumoured to be one of the forerunners in the long awaited auction.

The Gala Coral group, which includes casinos, bingo clubs and online betting sites, racked up sales of £1.2bn for the year ending 25 September 2010.

However, reports suggest that the group took a £177m hit due to revaluing of assets and restructuring costs, leaving operating profit at £105m. This was lost after interest costs of more than £300m, leaving the group £188m in the red.

But despite the shortfall, Gala Coral is thought to have submitted a bid to purchase the Tote chain to Lazard, which is handling the sale process.

John Penrose, minister for tourism and heritage, said the government received 18 bids for the Wigan-headquartered bookie and “a selected number of parties” have now progressed to the next round of the bidding process.

He added that the government had been pleased with the level of interest shown in the state-owned bookmaker.

However, Penrose refused to be drawn on the suitors that have been selected. He said: “Given the commercially sensitive nature of the process the government will not be making public the details of the individual proposals received as part of the open market process nor the identity of those parties that have been invited to participate in the next stage.”

Penrose added: “The government can also confirm that in the event that the Tote is sold on the open market it will honour the commitment of the previous government to share 50 per cent of the net cash proceeds of sale with racing.”

The sale of the Tote would end a long running saga in the racing industry, with a sale first mooted in the late 1980s. The bookmaker is estimated to be worth between £150m and £200m. It has more than 3,300 staff and 500 shops in the UK