Churchill Downs Incorporated (CDI) announced today that it has signed a definitive agreement to acquire Ellis Park Racing & Gaming in Henderson for total consideration of $79 million in cash. CDI will also assume Ellis Park’s track extension facility project in Owensboro.
According to a release, “CDI has commenced planning to make both critical investments in the Ellis Park racing infrastructure and to construct Owensboro Racing & Gaming, a track extension and entertainment venue at Owensboro’s Towne Square Mall that will feature 600 HRMs, a simulcast wagering center, and multiple food and beverage 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.
“This is an exciting announcement for the horse racing industry, the cities of Henderson and Owensboro, and the entire Commonwealth of Kentucky,” Kentucky Gov. Andy Beshear said in a release. “Churchill Downs has proven it has the experience, resources, and desire to reinvigorate Ellis Park into a premier racing destination and provide unmatched gaming entertainment.”
Ellis Park, located in northern Henderson, celebrated 100 years of racing this year. In addition to being recognized as the historic home of summer Thoroughbred racing in Kentucky, Ellis Park also features a gaming facility venue with approximately 300 historical racing machines (HRMs).
“We are very enthused to welcome Ellis Park to the Churchill Downs racing family,” Bill Carstanjen, Chief Executive Officer of CDI, said in a release. “Our team is committed to building 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 across the country to the Bluegrass State each July and August.”
The closing of the transaction is contingent upon approval by the Kentucky Horse Racing Commission (KHRC). If change of control is approved, the parties expect to close the transaction shortly thereafter.
“The opportunity to bring Churchill Downs to Owensboro is particularly significant to us,” Jason Sauer, Senior Vice President of Corporate Development for CDI, said in a release. “We are eager to start the work to elevate Ellis Park’s reputation as a summer destination for Thoroughbred racing while delivering a premier gaming and entertainment experience to Daviess County. We look forward to sharing more exciting details about our plans in the coming days.”
CDI will acquire all of the outstanding equity of Ellis Entertainment, LLC, the parent company of Ellis Park. For tax purposes, the transaction will be treated as an asset purchase, allowing CDI incremental tax benefits that will provide additional cash flow and will enhance the overall economics of the transaction.
