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LOUISVILLE, Ky., Sept. 15, 2022 (GLOBE NEWSWIRE) — Churchill Downs Incorporated (“CDI”) (Nasdaq: CHDN) today announced that it has signed a definitive agreement to acquire Ellis Park Racing & Gaming (“Ellis Park” ) in Henderson, Kentucky, from Enchantment Holdings, LLC, a subsidiary of Laguna Development Corporation, for total cash consideration of $79 million, subject to certain working capital and other purchase price adjustments . CDI will also take advantage of Ellis Park’s opportunity to build a track extension facility in Owensboro, Kentucky.
“This is an exciting announcement for the horse racing industry, the cities of Henderson and Owensboro, and the entire Commonwealth of Kentucky,” Kentucky Governor Andy Beshear said. “Churchill Downs has proven it has the experience, resources and desire to reinvigorate Ellis Park into a premier racing destination and provide unparalleled gaming entertainment.”
Ellis Park, located north of the Ohio River and just south of Evansville, Indiana, celebrated 100 years of running this year. In addition to being recognized as the historic home of summer thoroughbred racing in Kentucky, Ellis Park also features a gaming site with approximately 300 historic racing machines (“HRMs”).
“We are very excited to welcome Ellis Park to the Churchill Downs racing family,” said CDI Managing Director Bill Carstanjen. “Our team is committed to hosting a summer meet at the ‘Pea Patch’ that keeps more Kentucky-bred horses and Kentucky-based trainers in their home state while attracting top horse racing talent from all over the country in the Bluegrass State every July and August.”
“This investment will ensure our Kentucky riders and women have the best year-round racing circuit in the country and create jobs across the region and state. Churchill Downs is a great corporate citizen and an important part of the Kentucky team,” Beshear continued.
Closing of the transaction is subject to the approval of the Kentucky Horse Racing Commission (“KHRC”). If the change of control is approved, the parties expect to close the transaction shortly thereafter.
CDI has begun planning critical investments in Ellis Park racing infrastructure and building Owensboro Racing & Gaming, a track extension and entertainment venue at Owensboro’s Towne Square shopping center that will include 600 HRMs, a simulcast betting and multiple food and beverages. offerings. Over the next year, CDI expects its total investment in Henderson and Daviess counties to be approximately $75 million in addition to the purchase price.
“The opportunity to bring Churchill Downs to Owensboro is especially important to us,” said Jason Sauer, Senior Vice President of Corporate Development for CDI, “We look forward to beginning the work to elevate the reputation of Ellis Park as a summer Thoroughbred racing destination while providing a premier gaming and entertainment experience for Daviess County. We look forward to sharing more exciting details about our plans in the coming days.”
CDI will acquire all of the outstanding shares of Ellis Entertainment, LLC, the parent company of Ellis Park. For tax purposes, the transaction will be treated as an asset purchase, allowing additional tax benefits to the CDI that will provide additional cash flow and improve the overall economics of the transaction.
About Churchill Downs Incorporated
Churchill Downs Incorporated is a leading racing, online betting and gaming entertainment company rooted in our iconic flagship event, the Kentucky Derby. We own and operate four gaming entertainment venues with approximately 3,900 historic racing machines in Kentucky. We also own and operate TwinSpires, one of the largest and most profitable online horse racing betting platforms in the United States and we have eight retail sportsbooks. We are a leader in physical casino gaming in eight states with approximately 11,800 slot machines and video lottery terminals and 250 table games. www.churchilldownsincorporated.com
This press release contains various “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally identified by the use of terms such as “anticipate”, ” believe”, “could”, “estimate”, “expect”, “intend”, “may”, “could”, “plan”, “predict”, “project”, “seek”, “must”, “will”, ” and similar words or similar expressions (or negative versions of these words or expressions).
Although we believe that the expectations reflected in these forward-looking statements are reasonable, we cannot guarantee that these expectations will prove to be correct. Important factors, among others, that could materially affect actual results or results include the following: the receipt of regulatory approvals on desired or anticipated terms, unforeseen transaction difficulties or expenses proposed transaction, including, without limitation, difficulties that result in failure to realize the expected synergies, efficiencies and cost savings of the proposed transaction within the expected time frame (if any), our ability to obtain financing on the terms and schedule anticipated, disruptions to our or P2E’s current plans, operations and relationships with customers and suppliers caused by the announcement and pending of the proposed transaction, the impact of the novel coronavirus (COVID-19) pandemic, including the emergence of variant strains, and related economic matters about our results of operations, financial terms and our prospects; the occurrence of extraordinary events, such as terrorist attacks, threats to public health, civil unrest and severe weather; the effect of economic conditions on our consumers’ confidence and discretionary spending or our access to credit, including the impact of inflation; additional or increased taxes and fees; the impact of significant competition and the expectation of increased levels of competition; changes in consumer preferences, footfall, betting and referrals; loss of key or highly qualified personnel; lack of confidence in the integrity of our core businesses or any damage to our reputation; risks associated with equity investments, strategic alliances and other agreements with third parties; inability to respond to rapid technological changes in a timely manner; concentration and evolution of slot machine and HRM manufacturing and other technological conditions that could impose additional costs; inability to negotiate agreements with industry constituents, including riders and other racetracks; the inability to successfully focus on market access and retail operations for our TwinSpires Sports and Casino businesses and compete effectively; failure to identify and/or complete or fully realize the benefits of acquisitions, divestitures, development of new sites or expansion of existing facilities on time, within budget or as planned; general risks relating to real estate ownership and significant expenditures, including fluctuations in market values and environmental regulations; reliance on our technology services and catastrophic events and system failures disrupting our operations; online security risks, including cybersecurity breaches, or the loss or misuse of our stored information as a result of a breach, including customers’ personal information, could result in enforcement action. law by government or other litigation; personal injury litigation relating to injuries occurring at our racetracks; compliance with the Foreign Corrupt Practices Act or applicable money laundering regulations; payment risks, such as the risk associated with fraudulent use of credit and debit cards; work stoppages and labor issues; risks related to pending or future legal proceedings and other actions; highly regulated operations and changes in the regulatory environment could adversely affect our business; restrictions on our credit facilities limiting our flexibility to operate our business; non-compliance with financial ratios and other covenants of our credit facilities and other indebtedness; increase in our costs of insurance, or obtaining similar insurance coverage in the future, and inability to recover under our insurance policies damage to our properties from bad weather and accidental events; and risks associated with trading under Section 1031 of the Internal Tax Code.
We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Source: Churchill Downs Incorporated