What's in cards with Hubbard?

January 20, 1994|By Ross Peddicord | Ross Peddicord,Staff Writer

R. D. Hubbard, principal stockholder in Hollywood Park and likely the next operator of Laurel and Pimlico race courses, is depicted as either a horse racing visionary or a villain.

Within the industry, Hubbard is talked about in contradictory terms. On one hand, he is an innovator charting horse racing's course into the 21st century.

"Dynamic is the one word I'd use to sum him up," said Tony Chamblin, president of the Association of Racing Commissioners International.

On the other hand, he is characterized as ruining the sport's traditions by people who still see the horse and all the romanticism that goes with it as racing's main appeal.

"A missile out of control," is how Hubbard has been described by Charles J. Cella, president of Oaklawn Park.

At the heart of the controversy about Hubbard is his belief that the survival of racing is dependent on the introduction of other forms of gambling, such as card clubs, video poker or casinos, to attract new fans and regain a larger percentage of its shrinking share of the gambling dollar.

By later today, Hubbard could start determining Maryland's racing future. Under provisions of the Laurel and Pimlico shareholders agreement, either current operator Joe De Francis or minority owners Bob and Tom Manfuso must purchase the other's stock in the tracks for $8.2 million by tomorrow. One of the deals De Francis is working on -- along with attempting to find other investors -- would make the Hollywood Park corporation majority owner.

Hollywood Park could end up owning about 80 percent of Laurel and Pimlico. Hubbard's company would buy not just the Manfusos' stock, but also the interests of De Francis' other partners, Martin Jacobs and Karin Van Dyke. A horse racing source said G. Michael Finnigan, Hollywood Park's chief financial officer, will meet this afternoon with De Francis and Jacobs, presumably to complete the deal.

Hubbard could not be reached for comment.

In Maryland, California observers say, Hubbard probably foresees casino gambling. He likely would retain De Francis as his political pipeline to Annapolis. No casino-gambling measure will be introduced at the current legislative session, but next year is a possibility.

In the next couple of months, a $20 million card club -- where patrons play poker for money -- will be opening at Hollywood Park, much to the consternation of horsemen there who have tried to block it.

"He is the kind of guy that says a tidal wave of gambling is coming, and, at the same time, he is driving the water truck that is bringing it in," said Darrell Vienna, trainer of an Eclipse Award winner, 1992 champion 2-year-old colt Gilded Time.

"We have all sorts of protections in this area for racing from other forms of gambling," Vienna said. "There is no Indian land [for gaming] in Los Angeles or Orange counties. No riverboats. And the impact from Las Vegas is about the same as it has always been. At the same time, we still have probably the greatest year-round racing circuit in the country. Yet what is his answer for bankrolling it? Bringing in a card club."

It is unclear what impact the card club will have on pari-mutuel betting at the track and whether the horsemen will receive a cut of the proceeds.

Stock is on rise

But the impact on the price of the stock of Hollywood Park Inc., a publicly traded company, has been clear. In the last year, ever since plans for the card club were announced, the stock quadrupled from $7.50 a share to $30.

Last year, through the Paine Webber investment firm, Hubbard introduced a secondary stock offering and raised $104 million, enough to wipe out the track's bank debt and put it in the strongest financial position of its 55-year history, according to the Los Angeles Times.

"Detractors say that Hubbard is only interested in making money, that he'll do whatever it takes -- such as bringing in card rooms or casinos -- to look after his shareholders and himself first," Chamblin said. "But he has also proven he's interested in racing. He sees all the changing technology and proliferation of other forms of gambling and does what he has to do to adapt to keep racing a viable product."

Chamblin added: "It's refreshing that when owners of most tracks are retrenching or sitting still, R. D. is out there buying other tracks. He is extending in a market that others see as mature."

Jerry L. Carroll, chairman of the board of Turfway Park in Florence, Ky., is one of Hubbard's friends and another believer that racing has to be tied into other gambling and entertainment venues to be successful.

'He's not shy'

"Some people work well in chaotic times, when things are difficult, and they step in and take charge. That's R. D.," Carroll said. "He's not shy, and he believes there is a definite future in horse racing. I think now he's more interested in buying trophy tracks, like Laurel and Pimlico, than in starting up new ones. I think what he's paying [$15 million for controlling interest] is worth it for their names alone."

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