This week, the courts heard testimony regarding Magna Entertainment Corporation’s plan to have its parent company, MI Development, purchase its assets (including Pimlico Race Course and Laurel Park) out of bankruptcy. The courts must approve the reorganization plan before it can go forward.

Several hurdles to approval have materialized, including shareholder opposition and a plan to have Penn National Gaming operate slots at Laurel Park (should they ever get approved for slots). However, whether Penn National could legally operate those casinos when they already have an interest in slots in Cecil County remains to be determined. Also questioned during the hearing was how sincere Magna’s effort had been to obtain a stalking horse bid on the properties.

Shareholders were represented by an attorney who questioned MID’s business plan for the tracks, noting that the plan published what the company considered to be the value of the land, but not the value or business potential of the tracks themselves, noting that the company has not even attempted to estimate the value of the Preakness as a business asset.

However, Magna did say that the MID contract would include language confirming that the state of Maryland will have the first right of refusal should the MID ever attempt, in the future, to sell the tracks.

Closing arguments will be heard Monday, April 26.

To read more:

Daily Record report on Tuesday, April 20 hearing.

Daily Record report on Thursday, April 22 hearing.