DEPT. OF JUSTICE QUESTIONS ON INTERNET GAMBLING
ACQUISITION
29 January 2010
Churchill downs to cooperate with information
on Youbet acquisition agreement
The US Department of Justice is sticking it inquisitive
nose into a $126.8 million agreement by the Kentucky
horseracing giant Churchill Downs to buy Internet
gambling firm Youbet.com....but it's more about
anti-trust precautions than the legality of online
horserace betting.
The US horse racing industry
benefits substantially by being exempted from federal
laws regarding online betting.
This week the
horseracing group said that it would cooperate fully
with the DoJ regarding the transaction. The DoJ has
apparently requested additional information and
documentary material in connection with the parties'
proposed merger transaction. These actions, commonly
referred to as "second requests," have the effect of
extending the waiting period under the Hart-Scott-Rodino
Antitrust Improvement Act of 1976, as amended ("HSR
Act"), until 30 days after both parties have
substantially complied with the requests, subject to any
modifications of the requests to which the DOJ may
agree.
"CDI and Youbet are in the process of
gathering information to respond to the second requests
and are working cooperatively with the DOJ as it reviews
the merger," a spokesman said.
In November last
year (see previous InfoPowa reports) Churchill Downs and
Youbet jointly announced agreement on the deal, which
will see CDI acquire all of the outstanding shares of
Youbet, in a transaction valued at approximately $126.8
million based on the Nov. 10, 2009 closing price of CDI
common stock.
CDI, headquartered will
substantially increase its Internet betting footprint
when the Youbet.com deal is completed. The company is
betting that online wagering will keep up a fast pace in
an industry that has been sluggish during the recession
as gamblers tighten their spending.
CDI owns and
operates four thoroughbred racing facilities: Arlington
Park in Illinois, Calder Casino and Race Course in
Florida, Churchill Downs Race Track in Kentucky and Fair
Grounds Race Course & Slots in Louisiana. It also
operates slot and gaming operations in Louisiana and
Florida.
CDI also owns off-track betting
facilities, TwinSpires.com and other advance-deposit
wagering channels, television production,
telecommunications and racing service companies such as
BRIS and a 50-percent interest in the national cable and
satellite network, HorseRacing TV, which supports CDI's
network of simulcasting and racing operations.
Online Casino News Courtesy of
Infopowa
More news here.
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