The ailing betting agency ACTTAB needs an injection of capital to make it competitive again but the ACT government isn't willing to put up the cash.
Instead it is looking to sell the wholly-owned agency.
A final decision on how the sale will be conducted and under what conditions will be made by November.
"In order to ensure the long term viability of the business it needs an injection of private capital," Treasurer Andrew Barr told reporters in Canberra on Thursday.
"Look at what's happening in this market around the country and around the world: significant technological changes, use of smart phones and tablets and other devices.
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"The sorts of investments that are required are significant."
Tens of millions of dollars were needed and the government would have "extreme difficulty" in finding the money.
A PricewaterhouseCoopers (PwC) review of ACTTAB's future, which the government released on Thursday, recommended a full sale.
Chief Minister Katy Gallagher said the report made a compelling case but the government needed to examine the issues carefully before making a final decision.
This includes considering how the sale proceeds would be allocated, the best way to conduct it and the future of ACTTAB's 115 staff.
The PwC review shows the agency generates revenue of about $30 million a year, with pre-tax earnings of about $2 million.
Earnings have declined significantly in recent years and are forecast to drop by a further 13 per cent in the next financial year.
The report also said the agency "lacks the size and scale" to have translated recent modest government investments into revenue growth at a comparable rate to others in the industry.
"ACTTAB pools with other operators anyway, it is just too small to operate as a standalone business," Mr Barr said.
The treasurer declined to nominate an expected sale price or valuation for the business, saying the information was commercial-in-confidence and he didn't want to pre-empt any market sale.
ACTTAB is the smallest TAB in the country.
It's also one of two government-owned TAB agencies. The other is in Western Australia.
Opposition gaming spokesman Brendan Smyth said a sale was well overdue and believed there would be plenty of interest.
"It's a question now of what is the price and what value have the taxpayers of the ACT lost because this is a government that's taken too long to actually do the work and come to a decision," he said.
