Modell a losing track bidder

Ravens owner committed $40 million toward Churchill's $100M offer

Horse Racing

July 17, 2002|By Jon Morgan | Jon Morgan,SUN STAFF

Among the losing bidders watching from the sideline this week as Maryland's major thoroughbred racetracks were sold was Ravens owner Art Modell.

The NFL team owner, who has a longstanding interest in racing, said yesterday that he had committed to contributing $40 million of the $100 million bid that Churchill Downs Inc. offered the Maryland Jockey Club earlier this year.

The talks ended in February as the jockey club's focus shifted to Magna Entertainment Corp., a Canadian-based track operator that on Monday signed an agreement to buy Pimlico Race Course and Laurel Park. The deal values the tracks at $117 million. However, only about half that much money will change hands because Magna is getting 51 percent of the voting stock in the first phase and will assume $30 million in debt.

"I partnered with Churchill to bid on the Maryland Jockey Club," said Modell, a director emeritus of Churchill Downs. The Louisville, Ky.-based company owns a number of tracks, including its namesake facility where the Kentucky Derby is run. Modell has been associated with the company for 17 years, going back to when his football team was the Cleveland Browns.

He said the talks faltered not just because of money but also because of the role to be played by current jockey club president Joseph De Francis, and his sister, jockey club vice president Karin De Francis. The two controlled the majority of the tracks' voting stock and wanted to remain active in management.

Under the deal with Magna, they will remain as president and vice president of the track under five-year management agreements. They will appoint three members of a new, seven-member board of directors to be established by Magna and, assuming the pair exercises an option, will own 49 percent of the voting stock of each track. Magna will have the right to buy them out in the fifth year of its ownership, and they can demand to be bought out anytime during the next five years. Under the Churchill offer, the two De Francises would have remained at the track as consultants, Modell said.

But they wanted a phased-in sale, "similar to what I got with Steve Bisciotti," he said. In 1999, Modell sold a minority share of the Ravens to Bisciotti, an Anne Arundel County businessman who has the right to buy the rest of the franchise in 2004.

Modell said he met with various political leaders in the state during the negotiations for the tracks. He, too, would have served as a consultant had the deal gone through. But Churchill, a respected track operator, planned to bring in its own management team, Modell said.

"Our intent was to have Churchill move in," he said.

Modell said he sent Joseph De Francis a congratulatory note yesterday.

"I wish him well. Joe is a friend of mine," Modell said.

De Francis declined to comment on the talks with Churchill but said, "I'm very proud to call Art a good friend."

A Churchill spokesman yesterday said the company does not comment on potential acquisitions.

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