You might say this company has put its money on the sport of champions to win. Churchill Downs is a leading operator of horse racing tracks in the US, with four major race courses, including its namesake track that hosts the world-famous Kentucky Derby. Other tracks include Arlington Park (Illinois), Calder Race Course (Florida), and Fair Grounds Race Course (Louisiana). In addition to horse racing, Churchill Downs has gaming assets. It operates a number of simulcast networks and off-track betting facilities, as well as a TwinSpires wagering deposit service that allows punters to place bets online. Richard Duchossois, who controls diversified holding company Duchossois Group, owns about 20% of Churchill Downs.
Mergers and Acquisitions
Churchill Downs acquired a Mississippi property -- the Riverwalk Casino and Hotel in Vicksburg -- for approximately $141 million in 2012. The purchase adds to a previous acquisition -- Harlow's Casino Resort & Hotel in Greenville, Mississippi. It made that deal in 2012 for about $138 million as part of its geographic diversification strategy, and is attracted to Mississippi as a business and gaming location.
In 2010, the company acquired interactive-betting technology company Youbet.com for some $127 million. It made the deal in order to expand its online wagering capabilities; soon after the purchase it combined the Youbet site with its TwinSpires depositing service. TwinSpires is one of Churchill's online businesses, which also include Bloodstock Research Information Services (BRIS), a data service provider for the equine industry, and a minority stake in horseracing TV channel HRTV.
In 2010 the company closed its Churchill Downs Entertainment Group, a subsidiary it formed in 2009 in another attempt at diversification. Churchill Downs Entertainment Group was focused on developing new entertainment activities, such as concerts and new racing events. However, after its HullabaLOU Music Festival fell short of the attendance levels necessary to achieve a profit, the Entertainment Group was dissolved. The down economy's negative affect on consumer spending no doubt played a roll in the festival's demise.
In addition to its emphasis on new technology, Churchill Downs is focused on investing in its traditional gaming sphere. In 2010 the company opened Calder Casino, a new slot facility adjacent to its Calder Race Course near Miami. Calder Casino joins other Churchill casinos, including Fair Grounds Slots (a slot facility in Louisiana) and Video Services, LLC (operator of more than 800 video poker machines in Louisiana).
While still grounded in live horse racing, Churchill Downs has been actively investing in new ventures -- both gaming and non-gaming -- to diversify its revenue stream. Its 2010 and 2011 revenues increased primarily as a result of the Youbet and Harlow's Casino Resort & Hotel acquisitions. – less