Magna Entertainment Corp (MEC) - Some Perspective
 

Catching up on some posts tonite and have noticed some threads/comments on Magna.

As background, there are three major entities in US racing today - MEC (Magna), Churchill Downs Inc., and NYRA. Only one of the three is headed by a person who owns, breeds, races and loves thoroughbreds - Frank Stronach of MEC.

CD has been headed for the past 15+ years by Tom Meeker, who does not own, race, breed or otherwise care about TB horses except for how they affect CDI's bottom line and stock price. NYRA has the best franchise in the sport but has almost been driven to bankruptcy b/c of corruption.

MEC is headed by Frank Stronach, who has invested hundreds of millions of dollars of his own money to enhance the TB industry. No one at CD (for sure) or NYRA can say the same.

Has he (Stronach) made mistakes? Absolutely. At least they were mistakes that had the best interest of TB racing in mind.

Stronach should be lauded for his efforts and investment. We need more like him.

LR

Some clarifications. Tom Meeker is leaving Churchill by the end of the year.

Frank Stronach has invested hundred's of millions of dollars of investors in Magna's money into the thoroughbred industry. Your comment that he did it to " enhance " the industry is an opinion. The fact is he substantially overpaid for as much property as he could get his hands on in the hopes of getting slot revenue.

This is my favorite quote......" NYRA has the best franchise in the sport but has almost been driven to bankruptcy b/c of corruption." That is an opinion, which you are entitled to, but is unsupportable by facts. NYRA's current situation is the result of MANY things, and one being poor management IN THE PAST, but there are many, and more severe, others. Having a state OTB system, in many cases literally in their back yard, syphoning hundreds of millions of dollars directly out of the thoroughbred industry would be a major cause for the current state of affairs. A substantial financial burden levied upon them by a publicity hungry, and office hungry, district attorney would be another one. Not to defend in any way the tax fraud involving the mutual clerks, but considering that is the only concrete offense uncovered in the probe it would be far more appropriate to suggest that NYRA was run in a cleaner fashion than any racing institution in America. Try and make at least an attempt to tell the whole story to achieve any sort of credibility.

But hey....thanks for the Magna infomercial.

Couldn't agree with you more. There are quite a few NYRA fans here though that love to bash him. Stronach deserves huge credit for what he has done for racing.

Hope FS is doing well. So when are you going to try First Samurai on the turf? I would love to see FS and Kip Deville go at it in the Turf Mile. KD put in a nice effort this weekend, he just ran into a monster.

Those are extremely good points you make. I don't think I care for all of Franks moves but you can't knock his drive and commitment to the sport, including spending millions of his own dollars.

Unless I'm mistaken I don't think Stronachs breeding program and his stable is funded by MEC. I believe that is his own and separate from Magna. Therefore there is substantial investment of his own in the industry.

Ghoztzapper at stud is going to fund that guy for life. I bet he throws every nickel back in the sport too.

Here is the quote....

" MEC is headed by Frank Stronach, who has invested hundreds of millions of dollars of his own money to enhance the TB industry. No one at CD (for sure) or NYRA can say the same."

The money you are suggesting was for him to race, breed, and sell horses. Sorry if I am not ready to declare this a humanitarian effort to improve racing. I would suggest, and I don't think if given sodium pentathol Frank would disagree, that this was done for personal pleasure and profit.

I am glad you brought me back to the quote however. I don't think the Phipps family, just to name one member of the NYRA board, would agree with the last sentance.

I understand Frank Stronach's commitment to racing. I also happen to think it is highly debatable that he has been good for racing overall and, more importantly, I am very concerned about what affect his enormous investment will have on racing in the future.

Frankie has my respect and I "love" the guy for all he has accomplished and done for the sport.

However, the Magna method is not appropriate for NY racing. Upholding tradition, upgrading all dirt to synthetic, and maintaining an affordable family and fan friendly atmosphere are key here in NY.

These are not failed tracks that are up for sale and they don't need to be nuked into malls, casinos, outrageous admission prices.

We'll see on June 30th who the players are. Just jacking up prices and putting water slides in the infield is not an anwser.

I like all 3 entities. However, NYRA cannot operate as a non-profit. It just doesnt work for them. Stronach is awesome. I love this guy and his passion and his vision. CDSI knows how to make money and they have to report to the share holders. But Frank also has to answer to his share holders and they are not very happy. But he has taken so many one time charges that it hurts his bottom line. Frank or CDSI will do wonders for New York Racing. If the NYRA could be a for profit company I think they could do a much better job. New York has the best facilities and the best racing in the nation year round and it should have a top rate organization running it.

What else is Meeker supposed to do? The sad fact in business today shouldnt be lost on you here. Tom Meeker's main responsibility is maximizing the value of each stock in the hands of CDI's shareholder and in the long run the business will be better for it. That's what good CEO's do. One example would be James Kilts with the Gillette Co. He took over a struggling brand, greatly enhanced its value, making it attractive to potential suitors and sold it to Proctor and Gamble. He squeezed every dime of profit possible from the original Gillette stock and the shareholders reaped the rewards.

The fact that Stronach actually owns and breeds, etc and runs one of the major brands in racing today would worry me more than anything. Not to say he is a bad guy, because I doubt he is, but sometimes when you have emotional investment in something you are charged with running, that emotion can blind your otherwise sound judgment. In the short run, maybe that is good for people in the game, but it is possible any emotional decision could be a short term fix that is detrimental down the road. Who would want that? Another CEO responsibility is to ensure long term growth. Sometimes, emotional decisions hinder that.

I would rather have a beer and talk the game with someone like Stronach. But, if I wanted someone to make cold hard decisions, without any emotional attachment, give me someone else. That doesnt make Stronach a bad guy by any means. Its just business.

Hey LBig. Thanks for clarrifying things. I know nothing of this side of the racing world, but I would like to learn. You gave me a valuable bit of information.

And I hope to see First Samuri on the track very soon.

Considering Bill Nader, who is currently one of the top dogs " running " racing in New York, is 1-9 to be offered AT LEAST his current job by anybody who might get the NYRA franchise, I find it hard to understand why you would feel another entity would do a better job running NY racing.

I know he will be the top dog but he will be under a certain amount of "restraint." CDSI and MEC are for profit companies. Whenever you have someone to answer to, the product is better. Right now NYRA is a good ole buddy system with no checks and balances. This is why another entity would do a better job.

Actually, for the last few years NYRA has been overseen by NY State government. Sounds like at least " checks and balances " to me.

The one reason that I really hate Stronach is because he won't allow TVG to televise his tracks. It's completely ridiculous. Nobody has HRTV. I don't know the exact numbers but I think that TVG reaches about 30 million households while HRTV only reaches about 5 million. Stronach is a stubborn s.o.b. He is costing his company millions of dollars by refusing to let TVG televise his tracks. He doesn't care though.
Anyway, it really angers me that I can't watch Santa Anita or Gulfstream. I place the majority of the blame on Stronach although TVG is partially to blame also.

Are you kidding me. Like the gov't is going to have checks and balances--lol. Plus if it was run correctly, then the gov't would of had to step in.

I have both HRTV and TVG and TVG is much much better as far as coverage is concerned. HRTV analysts are at a bar at Santa Anita and have very little on-track analysis. On the flip side, CDSO will not let Frank televise their tracks either. So I guess they are at a stale mate.

At least if you award the bid to the NYRA NY won't have to hassle over who owns the properties.

Not sure what you mean. However, if you are suggesting that the government hasn't been overseeing just about everything NYRA has done over the last few years then I can absolutely guarantee you that you are wrong.

Furthermore, if you are suggesting the government moved in simply because NYRA wasn't running racing " correctly " then you are not looking at the situation with an unbiased eye.

No, but you will be able to buy them at the bankruptcy auction. :eek:

NYRA is corrupt trash. They ruined a great franchise with their corrupt organization. Enough with the non-profit fraud they have been pulling too. Non-profit horse racing. Non-profit business=corrupt business. Lets get some new blood in there.

I know the Gov't has been overseeing the NYRA for the past couple of years. What I am suggesting is that the Gov't is a buddy buddy systems with worse checks and balances than the NYRA. Pataki is fine but what does the State Gov't know about running a race track.

They are NOT running the racetrack. But they are checking ( and perhaps balancing ) NYRA's every move.

I will withhold judgement on your Pataki comment.

I'll chime in on Pataki. He is an idiot. Guy thinks he can be President in 2008. What a clueless idiot. Keep government out of horse racing. Funny but the seats at Saratoga are like gold chips to politicians. They use horse racing in NY like a chip but could care less about the betting public.

You have got to be kidding me if you believe this. They are just acting like they are over seeing things. The gov't on any level cannot run things correctly. Too many people who want a slice of the pie and people who do not know what they are doing.

Amen, the gov't needs to stay out of horse racing period. Pataki is a idiot but he is better than Spitzer. Some group of politicians New York has
1) bloomberg--idiot
2) Clinton -- idiot
3) Pataki -- idiot
4) Spitzer--idiot

I'm going to hold on to the belief that I know more about the situation than you.

Well, 1 out of 4 isn't bad.

Blacktwind -

1) Meeker's leaving CD has nothing to do with the relevance of my post.

2) Regarding NYRA - it's absolutely my favorite racing venue, bar none. Won three Grade 1 races there last year (Suburban, Hopeful and Champaigne). I love NYRA. You obviously know alot more than I do as to why the franchise is being auctioned off. I wish it wasn't.

3) No Magna infomercial. Just trying to provide some insight from my experiences in the game.

Best of luck to you. You might be interested in viewing the ESPN horse board. Lots more irrelevant bashing going on there.

LR

That is too funny right there.

I know for sure you know more about it than I. But sometimes a person from the outside or removed from the situation can see things clearly.

His network(HRTV)is crap.His betting site (that he strongarms people to join) is crap. The track redesign of Gulfstream is crap.You can't play his tracks through TVG(gee, wonder why we despise the guy?)He wants to force a g d shopping center up alongside the tracks.He wants to tear everything up to fit his own f'n eye.You know what? So be it,but you really shouldn't be surprised that he has enemies(he made every single one of them.)Long ago he decided to force people to do things(instead of allowing them to choose to do things.)He is a divider(plain and simple.)Funny how if you throw your weight around,and force people to do things the way you see fit,you are probably going to be despised.Just kind of works out that way. He changed the date of the Florida Derby to satisfy his own selfish needs.You know what ,Big Dog...get your bud to change that back to the traditional date,because it is probably the most disgusting thing he has ever done(or allowed to be done...since he always says he has no part in such decisions.)

S Shipper -

You are absolutely correct re: Meeker and his charter to increase CDI stock value (very serious).

My opinion comes from a TB breeder, owner, etc. though, versus a CDI shareholder.

Meeker has leveraged the CDI enterprise to optimize CDI share price; he's done nothing to promote Thoroughbreds or the sport of racing. My investment / interest in the game is for the horses, not for stock appreciation in any of the enterprises that own the tracks.

LR

On 1, I realize what your saying but thought it should be mentioned. Believe me, I have heard the criticisms of meeker, but don't know very much about Churchill, to say the least, and really have no opinion on them one way or the other. The Hollywood move didn't seem to be in the best interests of racing though I don't know a lot about it.

2 - The franchise is only being " auctioned off " because for the first time in it's existence there are other entities interested in it and that is for absolutely no other reason than the incoming slots. Don't forget that NYRA was given the extension in 1997 very much because there were simply no other interested parties.

I'll pass on the ESPN board. But thanks for the tip. I, too wish you all the best of luck and continued success, and while we don't know each other ( you do realize we sat in adjacent boxes at Saratoga occasionally last summer? ) I am friendly with Bruce.

Btw -

I'm sure I would recognize you in person.

Currently on this forum, though, you know my name but I don't know yours.

Regarding NYRA, my understanding was that they almost had to file bankruptcy last year prior to the BC. Why, I have no idea.

Again, I love NYRA, and I was as astonished as anyone to hear this. I'm not from NY but firmly believe NYRA is the best TB franchise in the country.

I hope everything works out for the best re: NYRA. LR

The real truth is that considering how complicated the entire franchise situation is, and being that we are 18 months from the end of the current franchise agreement, there is next to no chance that this issue will be settled by the end of 2007 and NYRA will, at the very least, be still in charge on an interum basis in January of 2008.

Couldn't agree more with this Sumitas. Perfect.

i dont agree with some magna things the betting svc is sub standerd..but i do like what hes done with gulfstream park..the plan as i see it was to create a premier winter spot...the shopping mall is just a add on too a nice gaming exp..the slots are there only for a draw to to make purses in line or above ny ..the best in the country..therefore getting the best product..so i think his long range plan for gulf is great..i will visit after its done..hooves..

good points in this post

You said you like what Magna has done with Gulfstream. Then you said you will visit it after it's done. Does that mean you haven't visited the " new " Gulfstream...but like it?

I'm sure I misunderstood your post.

i like the plan and was there under construction..when finished ill be back ..was going to go for foy...

In all fairness you may want to reserve judgement on liking " what he's done " with Gulfstream until you visit.

For me, the South Florida racing experience has been completely ruined. I'm sure others will disagree, and for them I am happy, but I was uncomfortable in the new plant. I spent upwards of 250 racing days at the old Gulfstream and there is NO semblence of the pleasurable former plant remaining. I am not suggesting that all changes were not for the better, and I am all for reinventing racetracks for the future, but to deny the fans what is enjoyable about spending a winter day in the sun at the racetrack in the Miami area is a crime that I have a tough time forgiving.

And I am not even talking about the closet sized paddock and dangerously tight walking ring. I shudder to think of what could happen should a horse get loose in that cramped space. Suffice to say it will be a situation that racing will have a very difficult time recovering from.