- The Washington Times - Monday, April 20, 2009

WILMINGTON, DEL. (AP) - A bankruptcy judge has agreed to grant final approval of a modified financing plan for horse-track owner Magna Entertainment Corp.

The financing plan calls for $38.4 million to be provided to Ontario-based MEC by a subsidiary of its parent company, MI Developments. The amount was reduced from the $62.5 million initially proposed, and the maturity extended 60 days until Nov. 6, allowing a longer marketing period for a potential sales of MEC’s assets.

A hearing on a motion to approve sale procedures for certain MEC assets was postponed from Monday until May 4. Also Monday, MI Developments withdrew a related motion seeking approval of its stalking horse bid for other MEC assets, including Gulfstream Park in Florida and Golden Gate Fields in California.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

WILMINGTON, Del. (AP) _ A bankruptcy court hearing on the sale of horse track owner Magna Entertainment Corp.’s assets has been postponed for the second time.

The hearing in U.S. Bankruptcy Court in Delaware, which had been scheduled for Monday after it was delayed earlier this month, is now set for May 7.

Ontario-based Magna Entertainment is the largest horse track owner in the United States. Its holdings include Golden Gate Fields in northern California, Gulfstream Park in Florida, Lone Star Park in Texas and Baltimore’s Pimlico racetrack _ host of the Preakness Stakes, the second leg of the Triple Crown.

While the court’s consideration of the asset sale has been delayed, other motions were scheduled to be heard Monday, including a hedge fund’s request for the appointment of an examiner in the case.

Greenlight Capital Offshore Partners argues that an examiner or a Chapter 11 trustee is needed to investigate the ties between Magna Entertainment and its parent company, MI Developments. MID has been bidding for certain MEC assets and, through a subsidiary, one of MEC’s lenders.

Greenlight, which is an unsecured creditor of Magna Entertainment as well as a large shareholder in MID, has raised questions about the fairness of the proposed sale process.

On Monday, however, MID said it had withdrawn its bid for certain assets of Magna Entertainment, but that it would continue to evaluate whether to bid on Magna Entertainment assets during the bankruptcy process.

MID also said that terms of a financing facility provided to Magna Entertainment through its subsidiary had been amended.

Magna’s committee of unsecured creditors also has raised concerns about conflicts of interest because of the relationship between Magna Entertainment and MID. But attorneys for the committee have said its concerns have been resolved for the time being, and that there is no need for the appointment of an examiner, at least not on the broad scope that Greenlight has proposed.

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