Magna founder finds cash cow with horses

February 27, 2001 7:08 AM
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Frank Stronach, the Canadian auto parts magnate, has a wider view of the importance of horse racing than his recent buying spree would indicate.

Founder of Magna International Inc. (MGA) which recently spun off Magna Entertainment Inc. (MIEC) as the owner of Stronach’s seven racetracks, the Austrian-born self-made multi-millionaire has been controversial in his approach to a business-sport dominated by an "Old Boys" network. Only recently, he made peace with the supporters of the National Thoroughbred Racing Association (NTRA).

But according to MIEC’s most recent SEC filing, Stronach has a definite view of the future of his company, as well as the thoroughbred racing industry.

"As we develop our racing product in North America," Stronach wrote, "we see tremendous global opportunities.

"Basically, we believe that conducting wagering on horse racing is ideally suited to become a global business. Horses are admired and loved by people all over the world. The opportunity exists to take horse racing and wagering into every living room around the world via satellite, the Internet, interactive television, and telephone. Magna Entertainment intends to be a leading participant in electronic wagering through these media," he added.

Argosy Gaming Company (AGY) has closed on its previously announced purchase of the 29% limited partnership interest owned by Conseco Entertainment LLC in its Lawrenceburg, Ind., riverboat complex. The purchase brings Argosy’s ownership level to 86.5%. Company executives said they hope to soon own 100% of the casino.

After months of searching, GTECH Holdings Corp. (GTK) said last week it is close to designating a new CEO. Former gaming analyst Bruce Turner, who has been serving as company chairman, said he would remain active in company operation even after the CEO is appointed.

Louisiana Gov. Mike Foster has called a special session of the Legislature to begin on March 11. He said he delayed the call for one week because one senator will be out of town in the early part of the month. To win approval of a tax break for Harrah’s New Orleans Casino, Foster will need 20 votes in the Senate.

Continued growth in market share in international markets, especially in the U.S., is expected to help boost revenues, and profits for Aristocrat, the Australian gaming machine manufacturer, according to company CEO Des Randall. He said there was little new growth in Australia, "so we have focused on international growth for the business."

Ameristar Casino Inc. (ASCA) says it has placed a May 31 deadline at the St. Charles, Mo., Casino for players to turn in their Stations Casinos chips. Ameristar acquired the property late last year.

Missouri officials have renewed the gaming license for Harrah’s Casino in Maryland Heights, Mo.

Harrah’s Entertainment Inc. (HET) may have found a buyer for its property in Kansas City, Mo. The former Sam’s Town casino complex was placed on the auction block provided the buyer does not use the property as a casino site. Reportedly, a health industry software company, Cerner Corp., has the inside track.

Annual shareholders meeting for Shuffle Master Inc. (SHFL) has been set for Thursday, March 22, at the company’s headquarters in Las Vegas.

Penn National Gaming Inc. (PENN) has begun a cash tender offer for the 11% secured notes owed by Louisiana Casino Cruises, Inc.

WMS Gaming Inc. (WMS) says it has received sales orders for more than 4,000 gaming devices to go to California casinos, thus surpassing the company’s goal.