Magna Entertainment Corp. (MIEC), the
Ontario, Canada-based racing conglomerate, continued its push to industry
leadership by acquiring Lone Star Park near Dallas, Texas, for approximately
$100 million.
This will be the 11th track either
purchased or leased by the company that was created by Canadian industrialist
Frank Stronach, whose business plan has been to lasso as many tracks as possible
and provide a year-round racing simulcasting menu.
Among the tracks operated by Magna
Entertainment are Santa Anita, Golden Gates and Bay Meadows in California and
Gulfstream Park in Florida. Since the bigger tracks primarily operate in the
wintertime, Stronach was looking for a strong signal for the summer and fall
periods. Lone Star’s thoroughbreds run from April to July while its quarter
horse meet is conducted in October and November.
Lone Star Park Ltd. does not own the
real estate on which it is located. That is the property of the city of Grand
Prairie and is leased to the racing operators. The lease will expire in 2027.
Although Lone Star has about 50
investors in its partnership, about 70% is held by the family of Trammell Crow,
an international real estate developer in Dallas.
Magna has agreed to pay the investors
$80 million in cash and will assume $19 million in assumed liabilities.
On the corporate front, Magna announced
it will offer 20 million shares of Class A stock for sale through underwriters
Bear Stearns, BMO Nesbitt Burns and CIBC World Markets Corp. The offering
originally was announced last October but was withdrawn because of poor market
conditions.
