2002 - Harness Tracks of America, Inc.

HARNESS TRACKS OF AMERICA
Executive Newsletter
A daily fax and e-mail report on racing and gaming developments in North America and beyond
Stanley F. Bergstein, Editor
MAGNA, DEFRANCIS IN PACT
The long-discussed acquisition of the Maryland
Jockey Club by Magna Entertainment has been
completed, with Magna, Joe DeFrancis and his
sister Karin DeFrancis today announcing an “alliance”
under which they will share ownership of
Pimlico Race Course and Laurel Park. Joe
DeFrancis will continue as president and CEO of
the two tracks, with full authority and responsibility
for operations subject to normal corporate oversight
of their boards of directors. Joe and Karin
will serve on those boards, with Karin continuing
as executive vice president, working primarily on
the Preakness, and Joe will be proposed for election
to Magna Entertainment’s board of directors.
Magna will purchase a 51% equity share and voting
interest in the Maryland Jockey Club, and controlling
shares in the rest of the convoluted ownership
of Laurel and Pimlico. Those entities include
the Laurel Racing Association Limited Partnership,
of which Magna will buy 51% voting interest
and 58% equity interest in the general partner and
manager, and the entire limited partner interest of
the Laurel Guida Group, involving former major
harness owner Lou Guida. Magna’s acquisitions
will give it a 79% economic interest in the LRALP,
for an aggregate of some $50.6 million in cash, of
which some $49 million will be paid to LUK Flats
LLC, Martin Jacobs and the Laurel Guida Group
to acquire the entire ownership interests presently
held by them. In addition, LUK Flats LLC, Martin
Jacobs, the Laurel Guida Group, the DeFrancis
family and the Maryland Jockey Club have agreed
to form a joint venture to pursue development of
other business opportunities in Maryland, including
the potential development and management of
gaming ventures, if they become authorized by
state law. Frank Stronach called the acquisition
“an important milestone in our strategic
program of growth.”
July 15, 2002
SOLID NUMBERS WORLDWIDE
The Meadowlands was the world capital of horse
racing on Saturday, regardless of breed. With the
$1 million Meadowlands Pace for 3-year-olds, won
by the $2.2 million purchase Mach Three as the
feature, the track had on-site attendance of 22,473,
the nation’s largest, with its sister track Monmouth
Park next with 12,522. The Meadowlands also
had its highest handle of the season, $6,677,154.
In Chicago, HTA member Suburban Downs at
Hawthorne closed its first meeting in five years
with a Saturday night card featuring $375,000 in
purses, and up 55% in on-track handle over its
previous harness meeting.
And in Mikkeli, Finland, a crowd of 26,100 turned
out to see the world’s greatest trotter, Varenne,
win again in world record time, picking up another
$50,000 as he set a new world mark of 151.3 for a
mile on a five-eighths mile track.
45-SECOND CYCLES WORK FINE
A test conducted last week by the Thoroughbred
Racing Associations in conjunction with the three
major tote companies -- AmTote, Autotote and
United Tote -- reportedly was a rousing success.
The test, conducted at Delaware Park, involved
45-second cycling of the tote board, rather than
60-second cycling, and TRA executive vice president
Chris Scherf says the new software worked
well enough that Saratoga Race Course plans to
use it when it opens July 24. It is hoped it will
provide more accurate betting trends for patrons.
SCOTT TO BUY BANGOR
Bangor Raceway in Maine reportedly is being sold
to Capital One LLC, the Las Vegas real estate
company owned by Shawn Scott, now major
owner of Vernon Downs.