Churchill Downs To Manage Saratoga

Published: October 28, 2014 10:12 pm EDT

Saratoga Harness Racing, Inc. (SHRI) and Churchill Downs Incorporated (CDI) (Nasdaq:CHDN) have signed a definitive purchase agreement wherein CDI will purchase a 25 per cent membership interest in Saratoga Casino Holdings, LLC (SCH) for approximately $30.6 million, to be paid in cash.

SCH is a newly formed entity which will include the following assets - Saratoga Casino and Raceway in Saratoga Springs, N.Y.; SHRI's controlling interest in Saratoga Casino Black Hawk in Black Hawk, Colo.; its 50 percent interest in a joint venture with Delaware North Companies to manage the Gideon Putnam Hotel and Resort in Saratoga Springs, N.Y.; its interest in the proposed Capital View Casino & Resort in East Greenbush, N.Y; and SHRI's interest in a joint venture with Rush Street Gaming to build the proposed Hudson Valley Casino & Resort in Newburgh, N.Y. The purchase price remains subject to adjustments for SCH's working capital and debt at the time of closing.

SHRI and CDI have also signed a definitive five-year management contract wherein CDI will manage Saratoga Casino and Raceway and Saratoga Casino Black Hawk. Should CDI and SHRI be successful in their joint bid to build Capital View Casino & Resort, CDI will also manage that facility. A binding term sheet for such management agreement was included with the New York casino license application for Capital View Casino & Resort, submitted by CDI and SHRI on June 30.

Both the purchase and management contracts will become effective as soon as CDI and SHRI obtain necessary licenses and approvals in New York and Colorado. The parties anticipate approval in the second-quarter of 2015, however there can be no assurances with respect to timing of regulatory approvals.

Churchill Downs Incorporated (CDI), headquartered in Louisville, Ky., owns and operates the world-renowned Churchill Downs Racetrack, home of the Kentucky Derby and Kentucky Oaks, as well as racetrack and casino operations in Miami Gardens, Fla.; racetrack, casino and video poker operations in New Orleans, La.; racetrack operations in Arlington Heights, Ill.; a casino resort in Greenville, Miss.; a casino hotel in Vicksburg, Miss.; a casino in Oxford, Maine; and a 50 percent owned joint venture, Miami Valley Gaming and Racing LLC, in Lebanon, Ohio. CDI also owns the country's premier online wagering company,; the totalisator company, United Tote; Bluff Media, an Atlanta-based multimedia poker company; and a collection of racing-related telecommunications and data companies.

Saratoga Harness Racing, Inc. is the Northeast's premier racing and gaming company, and one of the Capital Region's largest employers, boasting a $15 million annual payroll and 630 employees at its Saratoga Springs facility. SHRI traces its history to June 1941 with the start of harness racing at the nation's third oldest harness track. Today, Saratoga Harness Racing, Inc. operates gaming, racing and entertainment venues in three states, including Saratoga Casino Black Hawk in Colorado, Ellis Park in Kentucky and the Gideon Putnam Hotel and Resort in Saratoga Springs, N.Y.