Penn National May Sell Stake In Pimlico, Other Maryland Tracks

Posted Under: News by Jim Murphy on 5th March 2011

Casino operations company Penn National is considering a sale of their financial stake in the Maryland Jockey Club, which owns and operates several Maryland racetracks including Preakness host Pimlico and Laurel Park.  The company had hoped to obtain a slots concession for Anne Arundel County but was not successful and is now looking to concentrate its efforts in the state on a recently acquired harness racing facility.

Penn National opened the state’s first casino in September and had been looking to expand their Maryland slots operations. Instead, the move suggests that for the immediate future at least they’ll focus their efforts on Rosecroft Raceway, a Prince George’s County harness-racing track it is buying for $11 million. The plan for the facility is to revive live racing and push for the legalization of slots at Rosecroft.  Penn National was able to get a great value price for the facility as it had been in bad financial shape for quite some time.  It stopped live racing to save money and had been operating as an off-track betting site for two years before closing completely in July. Penn National is pitching a slots concession as a way to bring revenue to the insolvent tracks which in turn will benefit the horse racing industry in the state.

Company spokesman Eric Schippers said that Penn National is hopeful that they’ll be able to resume live racing later in 2011:

“In terms of Rosecroft, we are eager to finalize our acquisition of that asset and to sit down with the harness horsemen to map out a plan going forward that would hopefully result in live racing resuming sometime this year.”

The issue of slots ownership in Maryland is currently mired in controversy and legal wrangling.  The state  General Assembly is considering legislation to prevent one slots license holder from “interfering” with another–though that term has yet to be clearly defined. The legislation was introduced by two senators upset at an effort by Penn National and the Jockey Club to prevent the Cordish Company. from building a slots casino at the Arundel Mills outlet mall.   Cordish was awarded the lone Anne Arundel County slots license in 2009. The Jockey Club was disqualified by the state because it didn’t submit the required fees and has since filed legal action challenging the decision.

Penn National is urging their partners in the Maryland Jockey Club to drop the lawsuit as a ‘good faith measure’–and one that would free them to more easily sell their financial interest:

“While we continue to believe in the merits of the case, we discussed potentially dropping the suit as a goodwill gesture and a sign of good faith that our only interest has been, and will continue to be, finding a long-term solution to help save Maryland racing.”

The Maryland Jockey Club appears amiable to dropping the suit:

“There are merits to the case but dropping the suit is a good faith gesture since our primary goal is a long-term solution for Maryland racing.”

Work on the Arundel Mills slots facility resumed recently after local opponents dropped a legal challenge to block it.  Some local groups opposing the casino have received funding from Penn National.