Oak Tree's Lease to Continue if Court Affirms

Oak Tree's Lease to Continue if Court Affirms
Photo: BenoitPhoto.com

Quieting some of the uncertainty surrounding Magna Entertainment’s bankruptcy woes, Oak Tree Racing Association has been assured that its long-term lease at Santa Anita will be honored.

Sherwood Chillingworth, Oak Tree’s executive vice president, told the California Horse Racing Board at its April 15 meeting that Oak Tree and MEC’s parent company, Magna International Development, have reached agreement on continuation of the association’s lease, which runs through May 2016.

But the final decision is still up to the court. MEC’s case, including which leases to affirm and which to turn down, will be heard April 20 in Delaware Bankruptcy Court. After the hearing date, MEC has 15 days to make revisions to its lease list.

“Our lease is on their affirmation list,” Chillingworth told the board. “In my judgment, we have a lease. I’m assuming that it will be through 2016."

Under the current bankruptcy scenario as outlined before the board, MID will become the controlling shareholder of the Los Angeles Turf Club, which owns Santa Anita.

Oak Tree, a not-for-profit association that has leased Santa Anita for fall racing since 1969, hosted the 2008 and 2009 Breeders’ Cup World Championships. After those two successful events, Santa Anita is under consideration as permanent host site of the Breeders’ Cup.

Meanwhile, MEC continues to make progress on its outstanding debts, reported Gregg Scoggins, Magna’s national director for regulatory affairs.

An agreement over simulcast wagering payments held up by the court has been reached with SCOTWINC (Southern California Off Track Wagering Inc.) and another is close with its Northern California counterpart, NOTWINC. Details were not disclosed, but those agreements also should be before the bankruptcy court next week, Scoggins said.

The off-track entities contend that MEC improperly listed as corporation assets more than $3 million that it was holding in trust at the time it filed for bankruptcy in March 2009. The CHRB filed an objection over the disputed funds with the bankruptcy court last month.

Meeting at Santa Anita, the board vowed to continue to keep close tabs on Magna’s debt resolution. Said chairman Keith Brackpool, “I’m really happy that you’re now paying what you’re obligated to pay.” 

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