Owner of Pimlico, Laurel tracks buys remaining 70% of AmTote

September 01, 2006|By Hanah Cho | Hanah Cho,Sun reporter

Magna Entertainment Corp., the Canadian owner of a dozen North American horse racetracks, including Pimlico and Laurel Park, said yesterday that it bought the remaining 70 percent stake in AmTote International Inc. of Hunt Valley - a pioneer of the electronic bet-processing system in the racing industry.

Magna paid $13.6 million for the rest of the privately held company, which more than 70 years ago single-handedly changed the face of racing by installing the first electronic system to process bets during the Great Depression. The purchase price is subject to a 10 percent holdback that will be released upon satisfactory completion of an audited balance sheet, Magna said. In 2003, Magna bought 30 percent stake of AmTote for $3.82 million.

AmTote Chief Executive Officer John C. Corckran Jr., his family members and a few minority stakeholders had held 70 percent of the company. The Corckran family, which bought AmTote a decade ago, will leave the company after helping with its transition, Corckran said. AmTote is a wholly owned subsidiary of Magna's MEC Maryland Investments Inc.

"We've enjoyed our long association with AmTote," Corckran said last night. "We're happy that Magna is taking it over because we think they're going to lead it to new and greater things."

He said AmTote - with 300 to 400 employees around the world - will remain in Hunt Valley.

"Our indication is that Magna intends to concentrate some of their technological operations in the [Hunt Valley] facility," he said.

In addition to owning racetracks across the country, Magna, based in Aurora, Ontario, operates Xpress Bet, a national Internet and telephone account wagering system, and HorseRacing TV, a horse racing cable network.

The company has about 5,300 employees.

"Since MEC's initial involvement in AmTote, the pace of innovation in the totalisator industry, and at AmTote, in particular, has continued to increase," Joseph A. De Francis, executive vice president of MEC, said in a statement.

"We feel that AmTote is at a key point in its history and as it moves forward we are eager to see it take advantage of its past innovations as well as its and the industry's future potential," De Francis said.

AmTote's roots date to 1927 when a disgruntled Harry Straus left a Maryland racetrack determined to fix the betting system. He bet in the last race of the day on a long shot with 12 to 1 odds. The horse won, but the payoff was a meager 4 to 1 given the system in place then.

"For many, it was a typical day in the roaring 20s - a decade of rampant corruption, unscrupulous gambling operations and quintessential greed," according to a short history of the company on AmTote's Web site. "Against this unseemly backdrop, Straus knew he would do something to restore honor to the Sport of Kings."

Straus and other engineers formed American Totalisator Co. In 1930, Straus installed part of his new system at Pimlico Race Course. It was a towering black scoreboard that electronically displayed the odds, order of finish and payoffs.

Three years later, Straus installed the country's first complete system at Arlington Park in Illinois that also included machines that issued tickets and bet-registering equipment.

Today, AmTote has service contracts for more than 70 North American racetracks and other waging entities.


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