Churchill Downs Completes Sale of Hollywood Park

Churchill Downs Inc. and Bay Meadows Land Company completed the sale of Hollywood Park racetrack and surrounding acreage at the Inglewood, Calif., site to Hollywood Park Land Company, an affiliate of BMLC, for $257.5 million. CDI will use the proceeds of the sale to pay down debt.

The $260 million sale price announced July 6 was reduced at closing by $2.5 million to cover the costs of addressing certain physical conditions at the property.

CDI will have the option to reinvest in Hollywood Park should significant gaming activities become available at Hollywood.

Over the next three years, CDI will distribute the Hollywood Park simulcast signal through its Churchill Downs Simulcast Network. CDSN will also distribute the simulcast signal for BMLC's racetrack in Northern California, Bay Meadows.

CDI purchased Hollywood Park in September 1999 for $140 million from Hollywood Park Inc., which now does business as Pinnacle Entertainment Inc. Since that time, CDI has operated two race meets annually on the 238-acre site and leased space to Pinnacle Entertainment for the operation of a card club.

Hollywood Park Racing Association, the HPLC affiliate that will conduct the racing operations, has received racing dates from the California Horse Racing Board and will offer 97 days of live racing at Hollywood Park in 2006, subject to the completion of further licensing requirements. HPRC has committed to continuing live racing at Hollywood Park for a minimum of three years and will aggressively pursue legislative changes to improve economic conditions for the horse racing industry in California.

HPLC will also seek entitlements from the City of Inglewood to permit alternative uses for the current Hollywood Park racetrack site, in the event that efforts to seek authorization for expanded gaming activities at California racetracks are unsuccessful.