Pepsi is reclaiming $45,485 in products from Magna

March 11, 2009|By Hanah Cho | Hanah Cho,

Pepsi Bottling Group is demanding that Magna Entertainment Corp., which is under bankruptcy protection, return $45,485.92 worth of products the soft drink company recently sold to the Maryland racetracks and elsewhere.

Bankruptcy law gives vendors a right to reclaim goods if the debtor received them while insolvent and sold within 45 days of the Chapter 11 filing.

Canadian-based Magna, which owns Laurel Park and Pimlico Race Course, filed for bankruptcy protection last week and put its assets up for sale. Magna listed assets of $1.05 billion and liabilities of $959 million, according to bankruptcy filings.

Pepsi said it "believes that the debtors were insolvent at the time they received delivery of the goods," according to a notice of reclamation demand filed Monday with the U.S. Bankruptcy Court in Delaware.

A detailed claim shows that products were delivered between Jan. 20 and Feb. 27 to various racetracks. The company, whose Pimlico track hosts the Triple Crown's Preakness, also owns Gulfstream Park in South Florida and Santa Anita Park in Southern California.

Pepsi lists eight charges to Maryland Jockey Club, Laurel, Pimlico or Bowie Training Center for products worth $1,582.78.

Pepsi said the products it is reclaiming "are not to be used, consumed, or sold by the debtor," according to the notice.

Separately, Magna said late Monday that its stock will be delisted from Nasdaq on March 16.

The company shares are also expected to be delisted from the Toronto Stock Exchange on April 1.

Magna's stock closed yesterday on the Nasdaq at 8 cents a share.

Racing at Pimlico will be reduced to 20 dates this spring. In Sports

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