By Nancy Lowry
Valley View Downs and Centaur Pennsylvania Land Development today filed for Chapter 11 bankruptcy in Delaware.
The move is expected to help the parent company, Indianapolis-based Centaur, to continue operations and clear the way for Centaur to launch Valley View Downs and Casino on Route 422 in Mahoning Township.
Kurt Wilson, Centaur’s chief financial officer, said the company’s debt “is significant and not supported by the current cash outlay,.”
Problems have included the economy, the delay of the Pennsylvania project, and the high taxes and $250 million Indiana casino licensing fee.
Centaur’s other facilities — Hoosier Park in Anderson, Ind., Fortune Valley Hotel and Casino in Central City, Colo., and three off-track betting operations in Indiana — will continue to operate, he said.
Wilson noted that other companies — including Kmart, Macy’s and the Chicago Cubs — have filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code and emerged stronger.
“This, we believe, will clear the way and get us back on track toward the development of the western Pennsylvania racetrack.”
In 2007, the Pennsylvania Harness Racing Commission awarded Centaur the state’s final license to operate a racing operation. Since then, the commission extended the time to get the track up and running to September 2010.
This morning, Wilson said Centaur expects to meet that deadline, but offered no anticipated groundbreaking date.
“We spent a lot of money and did a lot of preliminary work.”
Centaur, he continued, had anticipated breaking ground in July 2008 and had completed preliminary work to meet that date.
However, when the Pennsylvania Gaming Control Board failed to award a license to operate a slots casino by July 15, 2008, Centaur defaulted on an almost $1 billion loan and lost its financing following the collapse of the credit market.
“We have been negotiating for several months,” Wilson said, “and seeing a robust upturn in the market from this summer and into the fall.”
