A consortium of leading figures in the racing industry has reportedly agreed to purchase a stake in the Tote, with a view to taking full ownership.
In February, it was reported that Betfred co-owner Fred Done was seeking to sell a 25% stake in the brand and had reached advanced talks with an unidentified consortium.
At the time, it was suggested that Betfred could offload the stake for over £30m (€34.2m/$40.3m), thus valuing the Tote at between £125m and £150m.
Sky News has now reported that Alizeti Capital has handed over approximately £20m to Betfred as an up-front payment in return for a minority stake.
However, Sky News said this forms part of a wider strategy, with plans for the consortium to take full ownership of the Tote within the next five years in a deal worth more than £130m in total.
The agreement would also include the purchase of Rewards for Racing (R4R), a loyalty programme focused on the horseracing industry that currently partners with Bet365, Betfred, Coral and Betfair.
In a pitch to prospective shareholders, Alizeti Capital spoke of a three-to-five year partnership with Betfred, with Alizeti taking a 25% of the Tote business-to-business operation and a 75% stake in its digital and on-course consumer betting arm.
“At the end of the partnership Alizeti Capital will buy out Betfred's remaining equity stakes according to a clearly defined formula,” a racing industry figure who has agreed to back the deal told Sky News.
Related article: Betfred in talks over Tote sale – report