Churchill, Magna join
forces for NYRA franchise

Aug 8, 2006 3:53 AM

Bitter enemies while establishing their individual influences in the sport of thoroughbred racing, Churchill Downs Inc. (CHDN) and Magna Entertainment Corporation (MECA) are joining forces in a bid for the holy grail of racing.

The two publicly-traded companies announced that they have agreed to cooperate in the bidding process for the New York racetrack franchise and the right to operate Aqueduct, Belmont and Saratoga racetracks. And, as an added bonus, to build a slots facility at Aqueduct that could house up to 4,500 gaming devices.

The announcement was not that surprising since the two companies earlier this year got together in a partnership that will televise races in England.

But it appeared that the departure of longtime Churchill exec Tom Meeker and the appointment of his successor, Kentucky businessman Robert Evans, added fuel to the negotiations that could result in the New York franchise that will become available on Jan. 1, 2008.

The partnership of the two biggest track operators in North America does not necessarily win the franchise bidding, however. There are several other notable entities and groups seeking the operating license including the current operators of the track, the New York Racing Association (NYRA).

Also moving

John Boushy will be leaving his post as executive vice president for project development at Harrah’s Entertainment Inc. (HET) to become president of Ameristar Casinos Inc. (ASCA).

Boushy, who has spent nearly his entire working career with Harrah’s and its predecessors, is leaving the company just as Harrah’s CFO, Charles Atwood, moves up to vice chairman, serving behind CEO Gary Loveman.

Craig Neilsen, founder, chairman and CEO of Ameristar Casinos, said he was pleased to have Boushy join the company since the company’s various growth opportunities will benefit from Boushy’s experience.

Replacing Atwood as CFO will be Jonathan Haikyard who will add the responsibilities to those he now carries as senior vice president and treasurer.

Boyd shares

As part of the secondary offering of shares in Boyd Gaming Corp. (BYD), being sold by Michael Gaughan to generate the funds necessary to acquire the company’s newest property, South Coast Hotel/Casino on the south end of Las Vegas Boulevard, the company explained in an SEC filing that it will purchase nearly 3.5 million shares in the primary offering at a price of $32.4844 per share.

Also, in the event that the underwriters decide not to buy any portion of the 500,000 shares made available as an over-allotment, Boyd Gaming will acquire those shares as well.

According to published reports, once the sale is completed, the property’s name will be changed to Michael Gaughan’s South Pointe.

IGT’s deal

While Pennsylvania politicians still wrangle over gaming licenses and whether they should be postponed while legislators address proposed changes in the previously passed gaming law, International Game Technology (IGT) announced that it had contracted with PAP Security Printing Inc. of Lancaster, Pa., as its exclusive marketing agent in that state.

IGT made its choice after the Pennsylvania Gaming Board decided on how the gaming devices would be marketed and by the number of companies that would be required. Earlier, IGT had been licensed as a machine manufacturer in Pennsylvania.

Meanwhile, state Republicans have been challenging Gov. Ed Rendell, a Democrat, to establish a set of modifications in the existing law to address problems regarding broadening the attorney general’s enforcement power over the gambling industry.

THE INSIDER: Nevada Gold & Casinos Inc. (UWN) says the New York Lottery has approved a temporary license for the operation of video lottery machines at Vernon Downs Racetrack. Still questionable is whether a live harness meeting will be held at the facilities this year.

Pinnacle Entertainment Inc. (PNK) is suing three insurance carriers over Hurricane Katrina damage at its former Casino Magic property in Biloxi, Miss. Under dispute is whether the hurricane caused the damage or whether it resulted from flooding.

Isle of Capri Casinos Inc. (ISLE) says it has completed the sale of the company’s gaming properties in Bossier City, La., and Vicksburg, Miss., to privately owned Legends Gaming LLC for $240 million.

Shareholders on Tuesday, Aug. 8, will decide whether to accept the $17 per share offer made by a consortium for all the share of Riviera Holdings Corporation (RIV). Opponents charge the shares are worth between $21 and $22 per share.

Macau gaming mogul Stanley Ho is set to launch a $1.9 billion initial public offering in his Macau Gaming Co. at the Hong Kong stock market.

Casinos that would keep Massachusetts residents away from the two in Connecticut are being proposed by a Democratic gubernatorial candidate, Chris Gabrieli. "Keep the money in Massachusetts" is his theme.

A hedge fund called Liberation Investments is pressuring Multimedia Games Inc. (MGAM) to take action that would "maximize shareholder value" or face the prospects of efforts to replace the current board of directors.