Bidder for Rosecroft takes on a partner

Buffalo firm could become track's majority owner

Horse Racing

April 30, 2003|By Greg Garland | Greg Garland,SUN STAFF

Centaur Inc. of Indianapolis is taking on a partner to finance its purchase of Rosecroft Raceway in Oxon Hill, officials said yesterday.

The partner, Buffalo, N.Y.-based Sportsystems Corp., owns and operates greyhound and horse racing tracks, including the Wheeling Downs racetrack casino in West Virginia.

Sportsystems could wind up as the majority owner of Rosecroft under the terms of the deal. The track, near the Capital Beltway in Prince George's County, is considered a prime site for a racetrack casino if Maryland legalizes slots.

Sportsystems will have an option to convert its loan into a majority interest in Centaur Rosecroft, LLC, the company formed to buy the track, according to Jeffrey M. Smith, Centaur's chief executive officer.

The deal with Sportsystems was not prompted by the General Assembly's failure to pass a slots bill this year, Smith said.

"We always anticipated bringing on a partner," he said. "We've talked with [Sportsystems] and others for quite some time."

He said the company, a division of Delaware North Companies, offers "a lot in terms of what they bring to the table."

Bill Bissett, a vice president of Delaware North, said the company is not banking on future approval of slots.

"Our financial agreement is not contingent on slots legislation passing in Maryland," he said, adding that either way his company can bring "efficiencies" to make Rosecroft profitable.

But both he and Smith made it clear they would like slots at the track if they can get them.

"Their company has the financial wherewithal to take Rosecroft to the next level should gaming be considered again," Smith said. "If you look at their Wheeling Downs project, it's grown to over 2,000 slot machines and a more than $100 million investment."

Centaur Inc. has an exclusive agreement to buy 54-year-old Rosecroft Raceway from Cloverleaf Enterprises, pending approval of state regulators. The Maryland Racing Commission will have to review the new ownership structure, said commissioner John Franzone.

Smith said the terms of the deal with Cloverleaf Enterprises have not changed.

Centaur, which is part-owner of Hoosier Park in Indiana and also has casino investments in California and Colorado, offered a package of $55.4 million to acquire Rosecroft. The deal includes $10 million for the track and $45.4 million for purses over the next 10 years.

Delaware North began in 1915 as a sports concession business and expanded into a multinational foodservice, recreational and hospitality management company. The privately owned company, also based in Buffalo, has $1.3 billion in revenues and employs 25,000 full-time and part-time workers.

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