RICHMOND, Va. - The deal that would place the future of Maryland racing into the hands of a Canadian-based racing conglomerate passed its final hurdle yesterday about 150 miles south of Pimlico.
The Virginia Racing Commission approved Magna Entertainment Corp.'s agreement to buy a majority interest in the Maryland Jockey Club. The deal needed Virginia approval because the Maryland Jockey Club holds the contract to manage racing at Colonial Downs, a summer track east of Richmond, and to operate the track's four off-track-betting centers.
The Virginia commissioners joined their Maryland counterparts, who endorsed the deal last week, in welcoming Magna into their state by a unanimous vote after an upbeat hearing. Virginia commissioners said they hope Magna can help Colonial Downs build on two years of solid growth at its summer thoroughbred meet as well as expand its OTB network.
"We're pleased about the association of Virginia with the visionary group from Canada," said Robin Traywick Williams, chairman of the Virginia commission.
Magna and Maryland Jockey Club officials said they plan to close the deal in a week or two, depending on how quickly they can gather the parties together around the Thanksgiving holiday.
Through its newly formed subsidiary Maryland Racing Inc., Magna Entertainment Corp. will buy a controlling interest in Pimlico, Laurel Park and the Bowie Training Center in a deal valued at $117.5 million. Joe De Francis, president and CEO of the Maryland Jockey Club, will remain in charge of day-to-day operations.
Jim McAlpine, president and CEO of Magna, called Colonial Downs, a colonial-style track between Richmond and Williamsburg, "one of the hidden jewels" in Magna's transaction with the Maryland Jockey Club. As he had done at the Maryland hearing, McAlpine offered no specifics about plans for Virginia.
He said he will meet with Colonial Downs officials about how to enhance racing in the state. Colonial Downs will benefit by being part of Magna's simulcast network that it hopes someday to offer to international markets, he said.
Magna will own or operate 15 racetracks after finalizing deals with the Maryland Jockey Club and Flamboro Downs, a harness track with slot machines in Canada. Magna also will own or operate 41 off-track-betting centers. McAlpine said his company wants to expand that to 50 or 75.
"We see opportunities to do more for Virginia," McAlpine said. "OTBs are extremely important to us."
Colonial Downs owns four OTBs. State law permits six. Williams said she hopes Magna can help open two more, because any expansion of racing at Colonial Downs depends upon revenues from new OTBs.
Yesterday, the commission approved a 30-day thoroughbred meet next year at Colonial Downs from June 13 to July 22. Purses will be $200,000 per day. Commissioners and Virginia horsemen want to expand that racing season, but they can't - and still maintain purses - without proceeds from new betting at additional OTBs.
Colonial Downs opened in 1997 but struggled, despite rave reviews of its racing surfaces, especially its turf course. Since moving its brief meet two years ago from fall to summer, betting on-track has increased 42 percent and attendance has risen more than 50 percent.