09/03/2009 11:00PM

Magna withdraws biggest tracks from auction

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Magna Entertainment Corp., the bankrupt racetrack owner, has withdrawn Santa Anita Park, Lone Star Park, and a handful of other assets from an auction scheduled for Tuesday, according to documents the company filed in U.S. bankruptcy court.

The withdrawal of the assets leaves only two properties owned by Magna up for auction: Remington Park in Oklahoma City and Thistledown racetrack outside of Cleveland, Ohio. Magna has received an $82.25 million offer for Remington from the Chickasaw Nation, an Oklahoma Native American tribe with a string of other gambling properties in the state, and hopes to receive significant offers for Thistledown now that the racetrack has been authorized for slot-machine gambling through a budget item that is being contested in court by multiple groups opposed to expanded gambling in the state.

Magna, which filed for bankruptcy on March 5, owes $371 million to its parent company and largest creditor, MI Developments. The company arrived at the plan to auction off properties as a way to pay down that debt as part of its reorganization.

The withdrawal is an acknowledgment that Magna did not receive any bids for Santa Anita or Lone Star that the company deemed adequate. Magna paid $126 million for Santa Anita in 1998 and $99 million for Lone Star in 2000. Also withdrawn from the auction was Portland Meadows in Oregon, an interest in a retail development at Santa Anita, a horse-bedding company, and a vacant property in Northern California.

It is unclear how Magna intends to complete its reorganization without selling the properties. Officials involved in Magna's bankruptcy did not return phone calls on Friday.

Magna officials have said in the past that the company would take private offers for the company's other properties, including Laurel Park and Pimlico Race Course in Maryland; Gulfstream Park and Palm Meadows training center in Florida; and Golden Gate Fields in Northern California.

Early in its bankruptcy, Magna reached an agreement to sell Lone Star, Gulfstream, Golden Gate, and several other properties to MI Developments. However, the deal was scrapped after shareholders of both companies attacked the deal.

On Friday, the Thoroughbred Owners of California said that it has formed a committee seeking to bid on Santa Anita. The committee is being led by Arnold Zetcher, who said that the committee had so far been "involved in" Magna's bankruptcy, though he declined to say whether the committee had submitted a formal bid and declined to provide details about the group's current finances.