Magna Sells Two Tracks and Makes a Third Deal
A Delaware bankruptcy judge approved the sale of two Magna Entertainment racetracks Sept. 15 and an announcement for a third track to change hands also was made, according to the Associated Press.
The judge approved the sale of Magna Entertainment Corp.-owned Thistledown in Ohio to Harrah's Entertainment for $89.5 million and approved the sale of Remington Park in Oklahoma City, Okla., to a subsidiary of the Chickasaw Nation for $80.25 million. Later the same day Magna announced it had agreed to sell Lone Star Park in Grand Prairie, Texas, to the same Chickasaw subsidiary for $27 million.
According to the Associated Press, Harrah's offered $42 million in cash at closing and contingent payments of $47.5 million. An attorney for MEC said a Sept. 14 auction involved more than 40 rounds of bidding that started with Penn National Gaming Inc.'s stalking-horse bid of $22.3 million. PNGI already owns an Ohio track — Raceway Park in Toledo — and is a primary backer of a November referendum on full casino gambling in Ohio's four largest cities.
Harrah's Entertainment owns other racing facilities, including Harrah's Chester Casino & Racetrack in Pennsylvania, Harrah's Louisiana Downs in Louisiana, and Players Bluegrass Downs in Kentucky, as well as a 50% interest in Turfway Park in Kentucky.
In a Sept. 15 statement, Harrah's Entertainment said the sale is subject to satisfaction of "certain conditions" and receipt of required regulatory approvals. "We are excited to be entering Ohio and look forward to developing a first-class facility in Cleveland that will create significant employment opportunities in the region," the company said.
Thistledown has been on the block for months. A July directive from Ohio's governor for racetracks in the state to install video lottery terminals increased the value of the racetrack.
Thistledown is located about 15 minutes from Northfield Park, a harness track also approved for VLTs. The state and racetracks are awaiting the result of Ohio Supreme Court challenges to the VLT directive.
MEC already received a bid of $80.25 million for Remington Park in Oklahoma by a subsidiary of the Chickasaw Nation, which was approved Sept. 15. Global Gaming Solutions RP, LLC, executed an agreement Aug. 11 with the sale subject to a competitive bidding process and required approval of the United States Bankruptcy Court for the District of Delaware.
Now that the judge has approved the sale, it is anticipated that the deal will be closed by year end upon the approval of the purchaser for a racing and gaming license from the Oklahoma Horse Racing Commission.
According to documents filed Sept. 14 in U.S. Bankruptcy Court in Delaware, Global Gaming Solutions also will pay for Lone Star Park. John Elliott, the CEO of Global Gaming Solutions, said the Ada-based tribe intends to run the track without disruption.
Texas law states majority ownership of a racing license must be held by Texas residents, so Global Gaming would have a minority ownership interest in the license. The licensing process could take six months.
The Chickasaw Nation has made no secret of its interest in buying both Remington Park and Lone Star Park.
"We always approached it from the standpoint that we wanted both of them and saw synergies between them," Elliott told the Associated Press. "We see enormous entertainment value in both these tracks."
Unlike Remington Park, which has a casino, Texas law does not allow for that sort of gambling at racetracks. Elliott said the tribe would like to see that changed.
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