The Maryland Jockey Club, now operated by MI Developments, will be jointly operated by Penn National Gaming Inc. upon closure of the deal, the two entities announced May 7.
Under the terms of the joint venture, Penn National and MID will “work collaboratively to strengthen and enhance the racing operations at Laurel Park and Pimlico (Race Course), to maximize the use and value of the Maryland Jockey Club’s real estate assets, and to pursue other opportunities, including the potential for gaming, to maximize the overall value of the business,” the companies said in a release.
The deal is scheduled to close in mid-2010 and is subject to approval by the Maryland Racing Commission. There had been earlier reports PNGI could be tapped to run only future gaming operations should Laurel get slot machines.
“This transaction is consistent with our plan to enhance the returns of our racing and real-estate assets and pursue other opportunities, including the potential for gaming, to benefit the value of the Maryland Jockey Club,” MID chief executive officer Dennis Mills said in a statement. “Penn National is a strong partner with complementary pari-mutuel, real estate, and gaming industry expertise as well as a strong financial position.
“We look forward to working with Penn National, the racing industry, and local regulators to develop business models that will ensure the ongoing success of these high-quality assets.”
Said PNGI CEO Peter Carlino: “We are excited to acquire an interest in the Maryland Jockey Club, owner and operator of a pair of the country’s most historic racing venues, Pimlico Race Course and Laurel Park. Our involvement in Pimlico and Laurel Park is consistent with Penn National’s strategy of expanding and diversifying our portfolio of pari-mutuel operations and presence in key markets.
“We look forward to working with MI Developments on the redevelopment of surplus real-estate assets at the Maryland Jockey Club, as well as collaborating with the local horsemen and community members and leaders in Baltimore and Laurel to support their efforts to continue delivering a high-quality racing experience at these two historic racing venues.”
PNGI is building a standalone slots facility in Cecil County, Md., across the Susquehanna River from Havre de Grace. It also operates Hollywood Casino at Penn National Race Course in neighboring Pennsylvania.
Aspects of Penn National’s racing operation are part of a local grand jury investigation that began earlier this year in the wake of breakdowns by horses owned by Michael Gill. The owner was ejected from the track by the Pennsylvania Horse Racing Commission but still hasn’t been charged with any offenses.
Gill has alleged some owners and trainers at the Harrisburg-area track have “bought” stalls in deals involving jockey agents and the racing office. On May 6, PHRC executive secretary Michael Dillon resigned, and according to sources, more resignations are forthcoming.
PNGI was able to get slots at Penn National because of its racing license.
PNGI owns and operates 19 gaming facilities in 15 jurisdictions including Colorado, Florida, Illinois, Indiana, Iowa, Louisiana, Maine, Mississippi, Missouri, New Jersey, New Mexico, Ohio, Pennsylvania, West Virginia, and Ontario. MID recently obtained the MJC tracks as well as tracks in California and Florida from bankrupt Magna Entertainment Corp.