Churchill Downs Incorporated (CDI) has taken a significant stride in expanding its horseracing empire with the signing of a definitive agreement to acquire Ellis Park Racing & Gaming in Henderson, Kentucky, from Enchantment Holdings, an affiliate of Laguna Development Corporation. The cash deal, valued at $79 million, is subject to certain adjustments, including working capital. Additionally, CDI will assume Ellis Park’s exciting opportunity to construct a track extension facility in Owensboro, Kentucky. This move has garnered praise from Kentucky Governor Andy Beshear, who sees it as a chance to revitalize the horse racing industry and boost economic prospects in the region.
A Historic Milestone:
Celebrating its 100th year of operation this year, Ellis Park stands as a historic home for summer thoroughbred racing in Kentucky. Situated just south of Evansville, Indiana, and north of the Ohio River, the venue has also become popular for its gaming facility, featuring approximately 300 historical racing machines. The acquisition by Churchill Downs is expected to inject new life into this iconic racing destination and provide unmatched gaming entertainment to visitors.
Churchill Downs’ Vision:
CDI’s CEO, Bill Carstanjen, expresses the company’s enthusiasm about welcoming Ellis Park into their racing family. The company envisions creating a premier racing destination at the ‘Pea Patch,’ with a particular focus on retaining more Kentucky-bred horses and trainers in the state. The ultimate goal is to attract top horse racing talent from across the country to Kentucky during the months of July and August. This strategic investment is set to enhance Kentucky’s horse racing circuit, generate employment opportunities, and solidify Churchill Downs’ position as an integral part of Team Kentucky.
Awaiting Kentucky Horse Racing Commission Approval:
The completion of this transformative transaction hinges on the approval of the Kentucky Horse Racing Commission. Once the change of control receives the green light, the parties expect to finalize the acquisition promptly. CDI is already gearing up for the future, planning essential investments in the Ellis Park racing infrastructure. Furthermore, Owensboro Racing & Gaming, a track extension and entertainment venue at Owensboro’s Towne Square Mall, is in the works, boasting 600 HRMs (historical racing machines), a simulcast wagering center, and various food and beverage offerings.
Boosting Local Economy:
CDI’s investment in Henderson and Daviess Counties is projected to reach approximately $75 million over the next year, in addition to the purchase price. The move is expected to stimulate the local economy, create jobs, and bring an elevated racing experience and premier gaming and entertainment offerings to the region. CDI is eager to unfold their plans in the coming days, aiming to solidify Ellis Park’s reputation as a top summer destination for Thoroughbred racing.
Asset Purchase for Enhanced Tax Benefits:
CDI’s acquisition involves the purchase of all outstanding equity of Ellis Entertainment, the parent company of Ellis Park. This asset purchase structure allows CDI to benefit from incremental tax advantages, leading to increased cash flow and enhancing the overall economics of the transaction.
With the ink now dry on the definitive agreement, Churchill Downs Incorporated’s acquisition of Ellis Park Racing & Gaming marks a significant development in the horse racing industry. The $79 million cash deal, pending regulatory approval, is set to revitalize Ellis Park as a premier racing destination and gaming entertainment venue. CDI’s commitment to investing in the region and creating jobs is expected to boost the local economy and establish a strong year-round racing circuit in Kentucky. As the transaction moves forward, the horse racing community eagerly awaits the dawn of a new era for Ellis Park.