LEADING West Country property developers the Richardson family have secretly amassed a 9.3% stake in Rank, the embattled casino and bingo operator.

Lee Richardson, a director of Richardsons Capital, the family business, confirmed the stake-building to The Sunday Times.

He said: “The assets of the company are undervalued. Rank has 45 casino licences – those licences are no longer being dished out like candy so they are a valuable commodity. The share price has taken a real hammering and we believe we are getting in at value.”

Shares in Rank closed at 105¼p on Friday, valuing the business at just over £411m. In the past year they had been well over 300p.

Richardson declined to comment further on the family’s intentions but it is thought that they have no current plans to mount a takeover bid for the company, whose shares have been hit by a downturn in trade at the company’s bingo halls following the introduction of the smoking ban.

The Richardson family have built an estimated £500m fortune from haulage and property. The business was started by twins Don and Roy Richardson. Don died aged 77 in September.

Today Roy runs the business with his sons, Lee and Martyn. The family is best known for buying a 300-acre former steelworks in Brierley Hill near Dudley on which they built the giant Merry Hill regional shopping centre.

They went on to build a variety of projects, including Star City, a giant leisure scheme in Birmingham that includes a large casino.

News of the Richardson family’s stake-building comes just a week after Genting, the giant Malaysian casino group, snapped up its own 9.4% stake in Rank, which runs Grosvenor Casinos and the Mecca bingo chain.

Last month it emerged that Rank had rebuffed an approach from Harrah’s Entertainment, the owner of the famous Caesars Palace casino and one of the world’s biggest gambling operators. Harrah’s had wanted to trade part of its UK business, London Clubs International, for a 28% stake in Rank.

Other possible predators are thought to include Guoco, the Singaporean group behind Thistle Hotels, bookmaker Ladbrokes, and Aspers, a joint venture between Damian Aspinall and James Packer.

Rank will this week release a 49-week trading update to the stock market.

Analysts expect the company will be forced to slash its full-year dividend, possibly by as much as 50%. Last year Rank paid a dividend of 6p but analysts believe a repeat payout will be difficult because of the turbulent time it is experiencing.

The City will expect Rank to provide detailed information on current trading and whether it has reevaluated its strategy in the light of difficult market conditions. It is thought that business has not deteriorated since the group last updated the market in October.

Then, Rank’s share price fell to its lowest level for seven years after it gave warning that its full-year operating profits would be “significantly lower than in 2006”, when it achieved profits of £77.4m.

Although the smoking ban has had a huge impact, Rank’s problems have been compounded by a change in the rules governing the type of gaming machines it can offer in its bingo clubs.

The Gambling Act, which came into force in September, forced Rank to remove about 950 popular high-jackpot gaming terminals from across its bingo franchise.

The double whammy of the smoking ban and the new rules on gaming machines have hit all bingo operators hard.

The only other quoted bingo company, Top Ten Holdings, the UK’s third-biggest player, predicted last month that tough trading conditions would “persist through the second half” of its financial year.

The industry is lobbying the government to change the tax treatment of the game. Bingo halls pay both Vat and a gross profit tax, unlike other sectors of the gambling industry, which just pay the latter.

It hopes to persuade the Treasury to drop this “double taxation” to give embattled operators some breathing space.

Without a change in the fiscal regime governing bingo, there are fears that hundreds of clubs could be put out of business. Betfair, the online sports-betting firm, has invested £10m to launch Tradefair, a new subsidiary company specialising in bets on the financial markets.

It believes that the market for financial betting could exceed £400m.

Tradefair will operate independently of its parent.

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