NEWS
Churchill, Magna withdraw from Empire Racing
Posted: Wednesday, October 10, 2007 7:45 PM
by Jeff Lowe
Churchill Downs Inc. and Magna Entertainment Corp. have withdrawn from the Empire Racing Associates bid to operate the New York racing franchise currently held by the New York Racing Association.
The gaming operation Delaware North Companies also bowed out of the Empire Racing structure.
The defections came by mutual agreement, according to Empire Racing Chief Executive Officer Jeff Perlee, and followed testimony from officials representing New York Governor Eliot Spitzer to a state Senate committee that explained why Empire Racing did not receive Spitzer’s recommendation to operate the franchise.
Spitzer recommended that NYRA receive a 30-year contract to continue running the franchise, a proposal that must receive approval from the state Legislature.
“[Representatives of Spitzer] specifically and publicly stated that the presence of Churchill and Magna on the Empire team, and more specifically possible anti-trust issues that might raise, were the reason they chose not to recommend Empire,” Perlee said. “Throughout this process all of our members have had the understanding that if the presence of any one is identified as a detriment to the success of the rest, that we would take the appropriate steps.”
Questions from Delaware North related to projected revenue from video lottery terminals also affected Empire Racing’s status in Spitzer’s assessment.
“[Churchill, Delaware North, and Magna] return their shares back to the core of the horsemen and breeders who founded the company and the other entities involved,” Perlee said.
Marylou Whitney, Empire Racing’s honorary chairperson, also announced on Wednesday that she would divest her shares in the organization.
“I originally joined Empire Racing 14 months ago inspired by a unique collaboration of several of the racing industry’s leading organizations, cemented by the support of New York’s dedicated horsemen and women,” Whitney said. “Today, Empire Racing has evolved into an entity with a vastly different feel and look, one that I no longer recognize.”
Woodbine Entertainment Group, Scientific Games Holding Co., and SL Green Realty Corp. remain partners in Empire Racing, Perlee said.
“There are no hard feelings,” Perlee said. “When those concerns had been articulated in a public forum by a decision maker, it’s incumbent to take action because this competition is still very much alive.”
The New York Thoroughbred Horsemen’s Association withdrew from Empire Racing in July, a day after a special report to the state inspector general’s office said out-of-state racing and gaming interests would take control of Empire if it received the franchise.
The latest defections came while Capital Play, one of the other entities who bid for the franchise, reportedly is negotiating with Empire Racing on a merger.
“We continue to believe that Thoroughbred racing’s success in the United States requires that New York racing be economically viable,” Churchill Downs Inc. Chief Executive Officer Robert Evans said. “Churchill Downs Inc. simply wants what’s best for New York horse racing, regardless of whether our company plays a role in the ultimate solution. Remaining part of Empire Racing is not serving that goal, so we’ve ended our participation in Empire Racing.”
Jeff Lowe is a Thoroughbred Times staff writer
