Churchill buys land from Duchossois Group

Churchill Downs Inc. has exercised an option to purchase 69 acres of property surrounding Arlington Park for $27.5 million from a company controlled by the former owner of the track, Churchill announced late on Thursday.

Churchill has leased the property for an undisclosed sum from the company, The Duchossois Group, since Churchill and Arlington merged in a non-cash transaction in 2000. In a release, Churchill said that its option to purchase the property expires in Sept. 2010, and that the company determined that it would be in its best interest to exercise the purchase option at this time.

It was not clear late on Thursday how Churchill would finance the purchase. Churchill has no long-term debt, and its balance sheet, at the end of September, listed $16.5 million in cash. Churchill officials did not immediately return phone calls.

The Duchossois Group is controlled by Richard Duchossois, the former owner of Arlington. As a result of the merger, Duchossois received stock in Churchill valued at approximately $72.5 million at the time. In addition, Duchossois, his son Craig, and Robert Fealy, the executive vice president of one of Duchossois s companies, Duchossois Industries, received seats on the board.

All three remain on the board. Churchill said in its release that the exercise of the option was unanimously approved by the disinterested directors on the board.