But Gala officials say that the termination of the 50/50 joint venture did not signal the end of its relationship with Harrah's and that it would maintain a "strategic alliance" with the US group "to take advantage of the opportunities that may arise following enactment of the bill." John Kelly, the Gala chairman and one of the most vocal critics of the government's U-turn, notes that, "We have built up an excellent relationship with Harrah's over the past two years and we do not intend to let that go to waste. But the joint venture is no longer the appropriate vehicle for us."
"It is now clear that the UK gaming market will develop in a different way than that envisaged when we set up the joint venture," reflects Gary Loveman, Harrah's president and chief executive. The two companies are believed to have invested a total of about £2 million in the venture.
Although the Department for Culture, Media and Sport has vowed to push through the revamped bill, the industry is unlikely to formulate any firm plans until the Treasury reveals the new tax regime.
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