Centaur's Rosecroft deal may continue racing rift

Despite bigger offer, Magna's bid falls short

Horse Racing

October 19, 2002|By Tom Keyser | Tom Keyser,SUN STAFF

The rifts that divide the harness and thoroughbred racing factions in Maryland will likely continue after Centaur Inc. takes over Rosecroft Raceway, said Jim McAlpine, president of Magna Entertainment Corp.

Magna, which has signed a deal to become majority owner of the Maryland Jockey Club, lost out in the sweepstakes for the Prince George's County harness track. The owners of Rosecroft voted shortly after midnight yesterday to sell the track to Centaur, which is part owner of Hoosier Park in Indiana and also owns casinos in California and Colorado.

Centaur's package for Rosecroft totaled $55.4 million, including $10 million for the track and $45.4 million for purses over the next 10 years. Under the Centaur plan, Rosecroft would race 160 days per year for purses of at least $62,000 per night. Rosecroft's purses currently are about $47,000 per night.

Magna had hoped to add Rosecroft to its growing empire of 12 racetracks in North America. As majority owner of the state's major thoroughbred tracks and sole owner of Rosecroft, Magna could have solved the disputes that keep the two sides from expanding the racing business in Maryland, McAlpine said.

"I guess the anxiety between thoroughbred and harness will continue," McAlpine said. "Thoroughbreds will continue to hamper the harness industry. It didn't have to be that way."

Although Magna offered the richest package for Rosecroft, the board of directors representing the track owners chose the long-shot bidder Centaur. The board also rejected Greenwood Racing, the parent company of three tracks (Atlantic City, Freehold and Philadelphia Park) and six off-track-betting centers in Pennsylvania.

The 17-member board represents the Cloverleaf Standardbred Owners Association, the horsemen's group that owns Rosecroft. A handful of board members solidly backed Magna. Another handful solidly backed Greenwood. At the end of an agonizing eight-hour meeting, Centaur became the compromise choice.

The 13-4 count for Centaur came on the 10th roll-call vote. On the first nine neither Magna nor Greenwood could muster more than seven votes. A two-thirds majority, or 12 votes, was needed to consummate a deal.

Magna's pending partnership with the Maryland Jockey Club and its CEO and president Joe De Francis cost it support. Several board members said that after years of negotiating with De Francis, they didn't want him serving in management.

McAlpine told the board that De Francis would have no management role in Rosecroft. McAlpine even offered to submit a letter to that effect. The board's anti-De Francis bloc was not swayed.

Jeffrey Smith, CEO of Centaur, pledged to work with Magna on issues that could unite the horse racing industry in Maryland. He said that even though Centaur owns casinos, its purpose in pursuing Rosecroft was not limited to the possible legalization of slot machines.

"The real attraction is the potential to grow the business - with or without slots," Smith said. "We're very, very excited about the opportunities here at Rosecroft."

Centaur owns 38 percent of Hoosier Park. Churchill Downs owns the other 62 percent. Smith worked 18 years for Churchill, which had tried to buy Pimlico and Laurel Park but was outbid by Magna.

NOTE: The Maryland Racing Commission has pushed back to Nov. 13 its hearing on Magna's deal to buy a majority share of the Maryland Jockey Club. The commission had set the hearing for Oct. 28. Commissioners needed more time to examine documents relating to the sale, said Mike Hopkins, acting executive director of the commission.

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