Magna Entertainment Corporation Entrusts Hope in Slot Machines

On March 29, 2007, the Magna Entertainment Corporation, a company based in Canada that owns the Pimlico Race Course and Laurel Park, continued to put up their assets on the selling block in a move to cut down their debts. The racing tracks in Maryland are not for sale in the meantime, but that status could change if the state will not permit the slot machines at the track, according to the officials of Magna.

Michael Neuman, Magna Entertainment CEO, commented during a conference call that they will not wait forever. Neuman stated that the future of the racing tracks in Maryland is not a guarantee as most jockeys are going to Pennsylvania, Delaware and West Virginia, which all allow slot machines. He further stated that with "alternative gambling" available, the Maryland horse racing tracks would become good business assets.

Senate President, Thomas V. Mike Miller, continues to advocate for the legalization of slot machines, which can be given a tax. Miller commented that the profits could be used to supplement the $1.5 billion budget shortage in the state.

House Speaker, Michael E. Busch, who has been critical of the slot machines, commented that the state has already given so much help to the slots industry, like tax cuts and allowing off-track wagering. Last week, the House of Delegates passed legislation that will set aside $15 million from the state lottery, but the Senate has not reviewed the bill yet.

Brean Murray, a senior analyst from the investment bank, Carret and Company from New York, commented that the Maryland Racing Tracks will unlikely be sales candidates because of Maryland's attachment to the Horse Racing Industry. Magna Entertainment is already looking for solutions within the state to improve the value of the racing tracks.

Magna Entertainment, considered the biggest horse racing tracks in the state, has faced financial problems for a long time now. A recent review by Ernst and Young revealed that Magna Entertainment's losses and debts cast a shadow on its ability to continue staying in the business.

Tuesday, 01 May 2007
Darren G. Strachan