11/08/2006 12:00AM

Zia purchase expected to close in 2007


There will be no changes to operations at Zia Park in the immediate future following Penn National Gaming's announcement Tuesday that it has agreed to purchase the track and its slots casino for $200 million. The deal is expected to close in mid-2007.

Until then, it will be business as usual at Zia, said Bruce Rimbo, who is vice president of Zia and also a partner in the track.

Built at a cost of $45 to $50 million, the track opened for its inaugural season of racing in September 2005 and is currently conducting a mixed meet for Thoroughbreds and Quarter Horses. Zia sits on 329 acres and boasts 746 slot machines, as well as a one-mile racetrack and stable area of more than 1,500 stalls. Its majority owner is R.D. Hubbard, the former owner of Hollywood Park. The decision to sell was made for several reasons, said Rimbo.

"The timing, I think, seemed right, and the individuals that came forward with an offer to purchase were the right people," he said. "We've had numerous others contact us, but Penn National, we think, is such a quality company and quality organization that we were pleased to talk to them and everything fell together."

Rimbo said track officials had preliminary discussions with Penn in August. Penn National will spend the next year evaluating the Zia operation, he said.

"I had a meeting with a department heads down there and explained that to them that I will still be involved, and Penn has given us assurances their normal mode when they go into a facility is that everyone stays in a place for at least a year after they close so they can do their analysis of which people they think are the right ones and so on," said Rimbo. "So there will be really no changes, I would say, almost for the next couple of years. Everything will probably just maintain as it's been. It's been a very good operation so far, and I think Penn realizes that and sees no reason to make any quick changes."

Joe Jaffoni, a spokesperson for Penn, said the organization liked what it saw at Zia, which reported its operations generated approximately $69.7 million in revenue in the 12-month period that ended Sept. 30, 2006.

"They were attracted to it because of what's going on out there, and the way the job is getting done, and the way the facility has come together," said Jaffoni.

Jaffoni said Zia also fit the profile of facilities that interest Penn, those that have racing. Penn owns several racetracks, including Penn National in Pennsylvania and Charles Town Races in West Virginia.

The Zia deal is subject to regulatory approvals. Penn will first have to be licensed by the New Mexico Racing Commission, then come before the New Mexico Gaming Control Board for licensing, said Greg Saunders, deputy executive director of the New Mexico Gaming Control Board.