Magna Files For Bankruptcy; Golden Gate Fields to Be Sold

By Richard Brenneman
Thursday March 05, 2009 - 07:42:00 PM

Golden Gate Fields is up for sale as owner Magna Entertainment (MECA on the NASDAQ stock exchange) filed for Chapter 11 bankruptcy today (Thursday). 

The Albany race track is one of three tracks, a betting wire service and other assets that the company is offering for $195 million, with a $44 million down payment required. 

The other tracks are Gulfstream Park in Florida and Lone Star Park in Texas, according to the announcement issued from the company’s Canadian headquarters in Aurora, Ontario. 

Operations at the tracks will continue while the company looks for a buyer. 

The bankruptcy filing in U.S. Bankruptcy Court in Wilmington, Del., comes less than a week after the Toronto Stock Exchange announced it was striking the company’s shares from its rolls as of April 1. 

Magna listed $1.05 billion in assets at the time of the filing, along with $989 million in debts. 

Two of the company’s three independent board members overseeing corporate finances have resigned in recent weeks, with the delisting announcement following closely on the heels of the second resignation. 

In announcing the bankruptcy filing, Canadian auto parts magnate Frank Stronach said the company “has far too much debt and interest expense” and has been pursing “numerous out-of-court restructuring alternatives but has been unable to create a comprehensive restructuring to date due, in part, to the current economic recession, severe downturn on in the U.S. real estate market and global credit crisis.”  

Magna shares had dropped to an all-time low of 20 cents on Thursday—down from the all-time high of $198 seven years ago. They had risen to 22 cents by the time the last shares traded hands early Thursday afternoon.