MEC Magna Entertainment Corp.
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337 Magna Drive
Aurora, Ontario
Canada L4G 7K1
Tel (905) 726-2462
Fax (905) 726-2585
EXHIBIT 99
MAGNA ENTERTAINMENT CORP. SIGNS AGREEMENT
TO ACQUIRE LONE STAR PARK
March 6, 2002, Aurora, Ontario, Canada..........Magna Entertainment Corp.
("MEC") (NASDAQ: MIEC, TSE: MIE.A, MEH) today announced that it has entered into
an agreement with Lone Star Race Park, Ltd. and LSJC Development Corporation to
acquire substantially all of the operations and related assets of Lone Star Park
at Grand Prairie, a Thoroughbred and American Quarter Horse racetrack located
near Dallas, Texas. The acquired assets include the rights under a long-term
lease of Lone Star Park and a related purchase option exercisable at expiry in
2027. The purchase price of the acquisition will be satisfied by the payment of
$80 million in cash and the assumption of certain liabilities, including the
Lone Star Park capital lease obligation of approximately $19 million, and is
subject to usual adjustments at closing. The transaction is expected to close
in the second quarter of 2002, subject to certain conditions, including the
receipt of regulatory approvals.
Lone Star Park at Grand Prairie was opened in 1996. It is one of the most modern
racetrack and pari-mutuel wagering facilities in the United States. Lone Star
Park conducts a live Thoroughbred meet from April to July and a live American
Quarter Horse meet in October and November. Lone Star Park's racing season
complements MEC's current racing season by adding live racing dates at a premier
racetrack in the last three quarters of MEC's financial year. The track has been
conditionally selected to host the Breeders' Cup World Thoroughbred
Championships in 2005.
The following represents certain financial information of Lone Star Park for the
year ended December 31, 2001 (numbers are rounded to nearest $ million):
Live on-track handle bet at Lone Star Park: $ 52 million
Import handle bet at Lone Star Park: $178 million
Export handle bet on Lone Star Park races: $168 million
Total handle: $398 million
Revenues: $ 66 million
Earnings Before Interest, Taxes, Depreciation
and Amortization (EBITDA)--adjusted for
estimated non-recurring costs: $ 7 million
Frank Stronach, Chairman of MEC stated: "The acquisition of Lone Star Park at
Grand Prairie represents another step in MEC's program of expanding its racing
and wagering operations through the ownership of premier racetrack properties.
We are delighted to welcome the management and staff of Lone Star Park to the
MEC family and we are committed to maintaining excellent relations with the City
of Grand Prairie."
Jim McAlpine, President and Chief Executive Officer of MEC, stated: "Lone Star
Park is an excellent facility in a first class community that is well supported
by Thoroughbred and American Quarter Horse interests in the state. We look
forward to working with these groups in the years ahead to continue the growth
of Thoroughbred and American Quarter Horse racing in the State of Texas. The
ownership of Lone Star Park will allow MEC to provide additional quality racing
for its simulcast, television and account
wagering operations. MEC is also enthusiastic about having Lone Star Park named
as the site of the Breeders' Cup 2005 World Thoroughbred Championships. This
premier racing event will create tremendous excitement for Texas Thoroughbred
racing."
Corey Johnsen, President and General Manager of Lone Star Park, stated, "Lone
Star Park's management is excited about becoming part of the MEC family. We
look forward to working with MEC to expand Lone Star Park's racing business in
Texas and through distribution outlets across North America."
MEC, one of the largest operators of premier horse racetracks in the United
States, acquires, develops and operates horse racetracks and related pari-mutuel
wagering operations, including off-track betting facilities ("OTBs"), and owns
and operates a national account wagering system called XpressBet.
For more information contact:
Graham Orr
Executive Vice-President
& Chief Financial Officer
Magna Entertainment Corp.
337 Magna Drive
Aurora, Ontario L4G 7K1
Tel: 905-726-7099