Rank is told it must offload six of its casinos before it can take over rival Gala

Rank will have to sell off as many as six casinos if it wants to revive its £205m takeover of rival Gala Casinos, the Competition Commission said yesterday.

The leisure giant put its May takeover bid on hold when the deal was referred to the commission in August but has continued talking to Gala. The original bid was for 23 Gala casinos and three so-called cold licences, where it had the right to run a casino but had not built one.

Rank had already offered to sell five of the casinos in its submission to the Office of Fair Trading.

Yesterday the commission said its provisional finding was that the deal, as proposed, could damage competition in Aberdeen, Liverpool, Stockton-on-Tees, Bristol and Cardiff, as well as Edinburgh where Rank holds a licence but does not operate a casino.

The deal would leave Rank, majority owned by Malaysia's Guoco Group, and Genting as the only two major casino operators in Britain, the commission said.

Martin Cave, its deputy chairman, added: "Our concern is that with two of the national players merging, this will leave a number of areas with much reduced competition."