The renowned Churchill Downs Incorporated is solidifying its presence in the dynamic realm of historical horse racing (HHR) through a significant acquisition. They are purchasing Exacta Systems, a prominent technology supplier for HHR ventures, in a transaction valued at an impressive $250 million.
This calculated acquisition represents a pivotal moment for Churchill Downs, enabling them to capitalize on synergies with their recent procurement of Colonial Downs Racetrack and Rosie’s Gaming Emporium in the state of Virginia. Exacta’s state-of-the-art system integrates offerings from premier HHR machine creators such as AGS, IGT, and Light & Wonder, delivering patrons an unmatched gaming encounter.
Given Exacta’s existing role in powering HHR activities across crucial states like Virginia, Kentucky, Wyoming, and New Hampshire, this agreement broadens Churchill Downs’ scope and underscores its dedication to the expanding HHR sector. Churchill Downs Chief Executive Officer Bill Carstanjen expressed enthusiasm, noting that Exacta has served as a catalyst in the remarkable ascent of the HHR industry over the preceding ten years. He envisions amplifying Exacta’s national presence and enriching the gaming choices accessible to patrons at HHR venues nationwide.
This acquisition transcends mere expansion; it constitutes a shrewd financial maneuver as well. Structured as an asset transaction for taxation purposes, the agreement unlocks supplementary tax advantages for Churchill Downs, bolstering cash flow and enhancing its profitability.
The famed racetrack is leveraging its available funds and securing credit to acquire the business. Regulatory approval is anticipated to finalize the transaction sometime in 2023.
This development follows closely on Churchill Downs reporting historically high profits (adjusted) of $163.2 million during the recent quarter, despite a minor decrease in overall income.
