Churchill Downs Inc. buys back $138M of stock from Duchossois Group

Churchill Downs Inc. has entered into an agreement to buy back nearly $140 million worth of its stock from its largest shareholder, the company said late on Thursday.

The agreement allows Churchill to buy 944,756 of its shares from The Duchossois Group, a private company headed by former Arlington International Racecourse owner Dick Duchossois. The total cost of the transaction will be $138.1 million, at a price of $146.13 per share, Churchill said.

The transaction will leave The Duchossois Group with an even two million shares in the company, according to company records. The Duchossois Group became the largest shareholder in Churchill after Arlington was merged with Churchill Downs in 2000.

Churchill’s board had authorized the company to buy back $150 million worth of its shares at its most recent board meeting, according to an announcement from the company at the time. Churchill said in its Thursday announcement that it used a mix of available cash and borrowings from its senior credit line to finance the transaction.

Churchill’s stock price has risen steadily over the past year, in large part because of investor confidence in the company’s acquisition of a mobile game developer. Since November of last year, the stock has climbed from approximately $97 a share to its closing price on Thursday of $144.38.

The share price for the Duchossois transaction was set by taking the average of the company’s stock price over the previous 20 days, the company said.