Reports in the UK media this weekend claim that Gala Coral is in advanced talks with Rank over the sale of its casino division. Gala Coral has struggled in recent years and many insiders believe the only way the company can continue to operate is by breaking the company up and selling off parts of to reduce the massive debts associated with the company.

Rank, which operates the Mecca Bingo brand and Grosvenor Casinos is looking to increase the number of casinos it operates. It currently has 35 casino sites, which would increase to 59 if it acquires all 24 of its rivals sites. It is reported that the deal would be worth around £250 million and would make it the biggest casino operator in the UK.

The Sunday Times claims that the two companies are in the advanced stages of negotiations and the deal could be agreed by the time Rank reports its interim results on 9th February.

Rank had previously said that it wanted to increase the number of casinos it had to 45 by 2015, however this deal could see the gaming giant exceed that plan by the end of the year. Rank has been concentrating on its new G-Casino format which is aimed at a younger and less formal customer. The business, which employs more than 3,000 people, has all but four of its casinos outside London.

Gala Coral had a net debt of £1.3 billion at the end of 2011 and the deal therefore would enable the company to greatly reduce this and allow it to concentrate its efforts on the Coral bookmaking and Gala Bingo operations. Back in 2010 when the Gala Coral debts were subject to a restructuring plan and investors had to write off huge junks of their assets, there was much speculation that Rank would look to acquire the casino business. It would come as no surprise if Gala Coral split up its business and sold off the bingo clubs, focusing its efforts on the profitable betting operations.

Its position in the online bingo industry has certainly slipped in recent years and while Mecca Bingo, has changed its focus and strategies in its land based bingo clubs, Gala Bingo is regularly having to shut down non-profitable sites.