KY Commission Approves 30% Sale of Ellis Park
The Kentucky Horse Racing Commission has given unanimous approval for the sale of a 30% interest in Ellis Park racetrack to an entity controlled by Saratoga Raceway and Casino for $4 million.
Under terms of the transaction, Saratoga Casino and Hospitality Group, Ron Geary, who previously owned all of the Henderson, Ky., track, will continue as manager. Day-to-day operations of Ellis Park will be supervised by Saratoga Casino and Hospitality Group under a five-year agreement, subject to renewal by mutual consent.
The agreement also gives the Saratoga Casino and Hospitality Group the option to acquire an additional 20% interest in Ellis in one or more transactions. If Saratoga exercises that option and has 50% ownership of the track, it could exercise one additional option and purchase the additional 50%, giving it full ownership of Ellis Park.
Since Geary purchased Ellis six years ago from Churchill Downs, the track has struggled while facing intense competition from tracks in nearby Indiana that have purses subsidized by casino-style gaming at their facilities. Ellis has reduced purses and cut back on race dates, but recently completed one of its best meets in a long time. The 29-day meet that ended on Labor Day produced a 6.5% gain in average daily on-track betting, a 12.7% increase in average daily overall handle, and a modest 2.5% increase in attendance.
Also, the track recently became the second in Kentucky to offer Instant Racing, an electronic form of gaming in which the outcome of each spin of the wheel is based on the finish of previously run horse races. Instant Racing, which has been a huge success at Kentucky Downs and at Arkansas' Oaklawn Park, where it was conceived, has been deemed legal by the state attorney general, but is still being challenged in the courts.
According to KHRC figures, $146,842 was bet through the Instant Racing machines during their first day of operation at Ellis Park.
Ellis Park was able to convert part of its facility and purchase the Instant Racing machines through a loan obtained from Saratoga Casino and the management of the Saratoga Springs, N.Y. racing and gaming company provided assistance in implementation of the new gaming under a management contract.
Reiterating comments made by Saratoga Casino and Hospitality Group executives to a KHRC committee that reviewed and approved the ownership change, one of the new minority owners said they are committed to preserving live racing.
"We're excited and enthusiastic," James Featherstonhaugh, Saratoga Harness Inc.'s secretary, said. "We're from New York, but we're not from Manhattan. We come from horse country. We worked very hard to integrate gaming with racing; it's been good for racing."
Since casino-style gaming began at Saratoga Raceway, purses have quadrupled and racing dates have been significantly increase, Featherstonhaugh said.
The Ellis Park ownership transfer was the only significant action taken during the routine meeting. The KHRC's equine medical report showed that during the Ellis Park meet, there were three fatalities among the 2,129 starters.
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