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MADRID, Oct 17 (Reuters) - Racing Santander's future looked bleak on Thursday after the cash-strapped Spanish club said a capital increase designed to save them from financial ruin raised a mere 33,664 euros ($45,400) and had to be abandoned.
Mired in bankruptcy proceedings and relegated twice in the past two seasons, Santander were looking to raise 3 million euros in the first phase of the operation, the club said on their website (www.realracingclub.es).
They hoped eventually to reap a total of 25 million euros to prevent them from folding but would now have to rethink their strategy after failing to attract anywhere near the required amount of investment.
"The majority of shareholders let the first phase pass without moving to take control," president Angel Lavin said.
"The second phase ended and still nobody wanted to step up," he added.
"And the third phase, open to any investor, ... also concluded without anyone wanting to own the company."
Expectations of a bright future at Santander rose when they were taken over in January 2011 by Indian businessman Ahsan Ali Syed, who had failed in an attempt to buy English club Blackburn Rovers the previous year.
Founder and chairman of investment company Western Gulf Advisory, Ali Syed said buying into the club had been "a dream come true" and Santander could become a "third force" in Spain to challenge Real Madrid and Barcelona.
That lofty goal quickly proved a pipe dream and Santander were relegated from La Liga at the end of the 2011-12 season after finishing 10 points adrift at the bottom of the table.
Ali Syed disappeared from view and the north-coast club's institutional crisis deepened as they dropped straight down to the third tier of Spanish soccer at the end of last term.
After the failure of the capital increase, Ali Syed remains Santander's majority shareholder, local media reported. ($1 = 0.7412 euros) (Reporting by Iain Rogers, editing by Ed Osmond)