11/09/2010 4:31PM

Minor makes offer for racing assets of MI Developments

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A company affiliated with the Internet entrepreneur Halsey Minor made an offer on Tuesday to purchase the racing assets held by MI Developments.

The company, Minor Racing, said in a letter to the shareholders of MI Developments that it would pay “$150 million to $170 million” to buy Santa Anita Park, Golden Gate Fields, Portland Meadows, the bet-processing company AmTote, the account-wagering company XpressBet, and MI Development’s 50 percent stakes in Laurel Park, Pimlico Racecourse, and the television company HRTV. In addition, the letter said that Minor Racing was prepared to pay an additional $150 million for Gulfstream Park, the Palm Meadows training facility, and MI Developments’s “other Florida-based racing assets.”

Minor, who founded the internet company CNet, has made unsuccessful attempts to purchase racing assets in the past. He had previously made offers for some of the tracks cited in the letter when Magna Entertainment Corp., a subsidiary of MI Developments, was being reorganized in bankruptcy last year. MI Developments took over the racing assets of Magna Entertainment as a result of the reorganization.

Last month, Frank Stronach, the chairman of MI Developments and a major shareholder in the company, offered to buy all of the outstanding shares in MI Developments for $13 each, in an effort to take the company private. Magna’s stock quickly rose above $13 and has traded well above the offer since, in an indication that shareholders believe the offer undervalues the company.

Minor’s offer also drove the company’s stock up. On Tuesday, MI Developments closed at $16.21, up 76 cents, or 4.9 percent.

Minor’s offer would seem to value the racing assets at a total price approximating the $350 million debt that MI Developments forgave in exchange for the assets as part of Magna Entertainment’s bankruptcy reorganization. Many shareholders of MI Developments, Magna Entertainment’s former parent company, have objected to the company’s support of the racing business. In a release, Minor cited that dissatisfaction in offering to take the assets off the company’s hands, saying that “the inclusion of non-core racing assets in MI Development’s portfolio has been significantly detrimental to the interests of the company’s shareholders.”