Bookmaker Betfred said it had made an offer to buy state-owned bookmaker the Tote, worth close to £200m in cash.
Privately-owned Betfred said it supported the government's pledge that 50 per cent of the net proceeds from the sale would be put back into the racing industry.
Betfred also said it would make a contribution to the racing industry of £11m in 2012 and would make a contribution of at least £9M to the industry each year after that.
"Betfred's proposal ensures the government has a complete exit from the Tote, secures value for the taxpayer, delivers support to the racing industry and provides enhanced opportunities and security for the Tote's employees and other stakeholders," the company said in a statement.
The 200 million pounds valuation is in line with what analysts had expected the business to fetch.
Betfred said it was announcing the principal terms of its offer because a decision by the government in relation to the sale was imminent.
The coalition government said last year it would sell the Tote, which takes bets on horse racing, soccer and other sports, as part of a wider sale of government assets as Britain tackles a record peacetime budget deficit.
A consortium led by ex-British Airways chairman Sir Martin Broughton is also reported to be in the running to takeover the business.
City A.M. Reporter