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The UK government has rejected a bid from a consortium of racing interests to buy the state-owned bookmaker Tote and is preparing for an open market sale.

The bid did not meet the independent assessment of Tote's market value, which was necessary for a sale to proceed lawfully under EU state aid rules, the government said.

Instead, the business will now be offered on the open market and advisers will be appointed to maximise value for the taxpayer.

The Horserace Totalisator Board, known as Tote, was created in 1928 as a betting business and now operates over 450 shops and employs over 4,000 staff.

In 2005, the government tried to sell the business as part of its policy of ending direct involvement in the administration and financing of horseracing.
But by offering Tote at below market value to a racing trust, the government broke EU laws on state aid and was forced to withdraw the sale.

A consortium of racing interests including the Race Course Association, the Racehorse Owners Association, and the management and staff of Tote then made the bid, which has now been rejected.

Minister for Sport Gerry Sutcliffe said: "We will now be considering urgently how best to give effect to that undertaking in ways which meet the needs of racing, do not add unnecessary bureaucracy and are consistent with European state aid and competition regulations."

The government is also taking steps to appoint a chair to oversee the sale. The current interim chair, Sir Ian Good, will continue in this role until an appointment is made.