Churchill Downs Incorporated (CDI) has successfully concluded its acquisition of Exacta Systems, a pioneering provider of historical horse racing (HHR) technology, for a total of $250 million in cash. The completion of this strategic purchase positions CDI to leverage synergies and further enhance its presence in the Virginia gaming landscape.
Key Transaction Details:
The acquisition, subject to specific working capital and purchase price adjustments, solidifies CDI’s strategic foothold in the HHR market. Exacta Systems, with its ownership of Colonial Downs Racetrack and Rosie’s Gaming Emporium HRM facilities, aligns seamlessly with CDI’s vision for operational improvements and game diversification at its HRM facilities over time.
Operational Integration within TwinSpires:
Exacta Systems will operate within CDI’s TwinSpires segment, adding value to its portfolio and contributing to the company’s overall growth strategy. As a part of TwinSpires, Exacta will continue offering its suite of services to third-party HHR operators across Kentucky, Wyoming, and New Hampshire.
Financial Performance Overview:
In parallel with this acquisition, CDI reported remarkable financial results for the second quarter of 2023. The company achieved record revenue, reaching $768.5 million, marking a notable 32% increase compared to Q2 2022’s $582.5 million. The live and historical racing and gaming segments played a pivotal role in setting new adjusted EBITDA highs, contributing to CDI’s overall record in adjusted EBITDA.
Churchill Downs Racetrack Resumes Live Racing:
Looking ahead, Churchill Downs Racetrack is set to resume live racing on September 14, following a temporary suspension of racing operations. This suspension was initiated to conduct a thorough internal safety review after a series of horse injuries, including 12 fatalities, occurred in June. While no specific cause was identified, CDI took proactive measures, relocating races and reviewing safety and surface protocols.
CDI’s strategic acquisition of Exacta Systems for $250 million marks a pivotal moment in the company’s journey, positioning it for synergies, operational enhancements, and broader market influence. The financial success of the second quarter and the resumption of live racing at Churchill Downs Racetrack underscore CDI’s commitment to sustained growth, innovation, and the highest standards of safety in the racing industry. As CDI continues to navigate the evolving landscape of gaming and entertainment, the Exacta Systems acquisition stands as a testament to the company’s strategic foresight and determination to lead in the dynamic world of horse racing and gaming.