NEWS
Financial straits continue for Hoosier owner
Posted: Thursday, October 29, 2009 5:35 PM
by Frank Angst
Hoosier Park owner Centaur LLC said it is working with lenders to reorganize its capital structure after two of its affiliated entities filed for Chapter 11 bankruptcy in Pennsylvania.
Centaur said all of its racing, casino, and hotel operations will continue without interruption despite the company’s failure to make an interest payment to senior lenders due on October 27.
The two Centaur-affiliate entities to file Chapter 11 both are part of the Valley View Downs and Casino project. The company said the actions are the first steps toward a more comprehensive, company-wide restructuring.
In 2007, Centaur, a minority owner of Hoosier, purchased the majority interest in Hoosier held by Churchill Downs Inc. Churchill was scheduled to receive a $15-million payment from Centaur in the third quarter of this year. Churchill’s Chief Financial Officer Bill Mudd said the company is tracking Centaur’s problems.
“We continue to monitor the financial performance of Centaur and understand that they are working to restructure their debt,” Mudd told financial analysts and shareholders during a conference call on Thursday. “At this time we have determined that collectability is not assured and therefore we have not recognized the amount due under the agreement. We expect to know the outcome of this in the fourth quarter.”
Centaur believes the reorganization positions them to continue moving forward on the proposed Pennsylvania Standardbred track.
“This step in Pennsylvania demonstrates how serious we are in clearing the way to get the Valley View Downs project built and operating,” Centaur’s Chief Financial Officer Kurt Wilson said. “It allows the application process to continue and reflects our deep commitment to the project. The reason for this filing is to preserve the status of the Pennsylvania project, advance the restructuring process, and safeguard our gaming application.
“In today’s challenging economic climate, there has been widespread restructuring of debt in our industry. We anticipate that this proactive step on our part to restructure our debt will expedite progress in Pennsylvania.”
Frank Angst is senior writer for Thoroughbred Times
