08/09/2006 11:00PM

Another partner for Empire


SARATOGA SPRINGS, N.Y. - Scientific Games Corporation, the bet-processing company and lottery-equipment supplier, has purchased an equity stake in Empire Racing Associates, the fast-growing partnership that intends to bid on the franchise held by the New York Racing Association, Empire announced on Thursday.

Scientific Games, which is based in Manhattan, is the parent company of Scientific Games Racing, the bet-processing company that has the largest market share for parimutuel wagering in the U.S.

Jeff Perlee, Empire's chief executive, declined to specify the size of the stake purchased by Scientific Games, but said the company would receive a seat on Empire's 11-member board of directors. Empire's bylaws prohibit any partner from purchasing more than an 8 percent stake in the company.

Scientific Games is the latest company to purchase an equity stake in Empire, which was formed earlier this year by New York business and political leaders. Delaware North Companies, a racetrack and casino operator, and Woodbine Entertainment Group, the Canadian company that owns Woodbine and runs a slot-machine casino in partnership with the provincial government, have also purchased equity stakes in Empire. The New York Thoroughbred Horsemen's Association is also a partner in Empire.

NYRA's franchise to operate Aqueduct, Belmont, Saratoga, and a slot-machine casino at Aqueduct expires at the end of 2007. A state committee has asked bidders to respond to a request for proposals to gain the franchise by Aug. 29 of this year.

Scientific Games Racing, which was formerly known as Autotote, was NYRA's bet-processing partner for 20 years prior to losing the contract late in 2004 to United Tote.

In addition to its racing business, Scientific Games supplies lottery equipment to the New York State Lottery Corporation and to other states. The company, through Autotote Enterprises, owns offtrack betting parlors in Connecticut.

Perlee was formerly the head of the New York lottery corporation. Perlee said while he was at the state lottery, Scientific Games lost one of its contracts with the state. It has since becaome the state's largest lottery ticket supplier.

In 2002, an employee of Scientific Games pleaded guilty to fraud charges after manipulating a pick six ticket on the 2002 Breeders' Cup card at Arlington Park. Scientific Games fired the employee, Chris Harn, prior to Harn being arrested and formally charged.