Magna makes mistake with firing of Raffetto
In professional sports, team success starts from the top down — meaning the owner hires good help, makes strategic long-term plans and, very importantly, stays the course.
In horse racing, there is a company, Magna Entertainment, that practices little of the above. Its latest gaffe was firing Lou Raffetto, president of Laurel Park and Pimlico.
What Raffetto did in Maryland racing was nothing short of miraculous. Raffetto kept Maryland racing alive despite vicious competition from “racinos,” racetracks that also have casinos. The neighboring states of Delaware, Pennsylvania and West Virginia offer higher purses driven by slot machine profits.
Raffetto has Laurel Park on the verge of obtaining a casino slot license, which is a remarkable achievement. Still, all it did was get him fired.
Magna has a history of hiring and firing good executives in a revolving-door policy. The company has spent money on improvements, but not always wisely.
Creating Palm Meadows training center in Florida, widening the turf courses at Laurel and Gulfstream, and installing synthetic surfaces at Santa Anita and Golden Gate have improved Magna’s racing product. However, costly building renovations to Santa Anita Park ($50 million) and Gulfstream Park ($125 million) have yielded a poor return.
Magna stock was selling for as little as $1.12 per share this week. I consider Magna ripe for a takeover, hostile or otherwise. Despite massive debt, it owns terrific gaming assets that can be acquired for nickels on the dollar.
Envision this: A cash-rich Indian tribe with political influence and strong casino know-how buys Magna. Three Magna tracks — Gulfstream, Laurel and Remington — make for lucrative racinos in the Miami, Baltimore and Oklahoma City areas.
Tracks in three more states — California (Golden Gate, Santa Anita), Ohio (Thistledown) and Texas (Lone Star) — have racino possibilities. That’s if the Indian tribe can manage to negotiate gaming compacts with each state government.
Magna also owns HRTV, which offers wide distribution of its own racing product and that of Churchill Downs.
Admittedly, a Magna takeover is a far-fetched idea. However, I’ve seen distressed casinos in Las Vegas get new ownership, a transfusion of cash and smart management and turn things around.
Remember that in business the rich get richer by buying low and selling high.
• WORLD SERIES QUALIFIERS — Congratulations to Gordon Jones for winning the Horseplayer World Series qualifier at The Orleans last week. The top 10 finishers qualified for the HWS in January.
Jones, a former handicapper and columnist for the Los Angeles Herald-Examiner, is the house handicapper at Sam’s Town and on weekends appears on “Track Talk” on KLAV-AM (1230). His “Track Talk” cohort, Patrick McQuiggan, finished seventh, also qualifying for the HWS.
Another notable finisher was Turf Paradise handicapper Howard Hong, who was sixth.
At Green Valley Ranch, Gary Bain and Bill Evans qualified for the Daily Racing Form/National Thoroughbred Racing Association National Handicapping Championship.
Both tournaments are scheduled for Jan. 24 to 26 in Las Vegas.
Richard Eng’s horse racing column is published Friday. He can be reached at rich_eng@hotmail.com.