New Castle News

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December 2, 2010

Shick among bidders for racetrack

NEW CASTLE — Carmen Shick is still in the hunt for a harness track for Lawrence County.

And a casino to go with it.

But the local developer is up against interests who appear to be determined to move the track elsewhere.

At an Oct. 20 auction to sell the assets of Valley View Downs, the proposed harness track and casino in Mahoning Township, Shick and his company, Bedford Development Management, submitted the highest bid — $7 million.

Attending the auction via telephone, Shick offered a non-refundable bid of $1.3 million up front followed by $4.2 million at closing — expected to be Dec. 13 — plus an additional $1.5 million to be paid on the one-year anniversary of the grand opening of the racetrack/casino.

Pittsburgh-based American Harness Tracks, submitting a bid of $5.6 million, was deemed the successful bidder by attorney Gerald Uzzi who conducted the auction.

American Harness Tracks offered $1.3 million to be placed in escrow and $4.3 million at the closing for the “as is-where is” racetrack to be located in Mahoning Township. The newly-organized group includes attorney Charles Knoll, son of the late lieutenant governor, Catherine Baker Knoll.

However, comments made during the bidding process suggest part of American Harness Tracks’ goal is to transfer the license to another area, possibly near Johnstown.

The bid is pending approval of the U.S. Bankruptcy Court.

After conferring with Centaur and its financial adviser, Innovation Capital, Uzzi announced American Harness Tracks as the winning bidder, saying the creditors would not agree to “value deferred considerations” as part of the price. This placed Shick’s bid at $5.5 million.

Shick said yesterday he will continue to pursue the matter. He anticipates filing an objection to the auction results with the U.S. Bankruptcy Court in Delaware.

The deadline for filing is tomorrow.

SHICK SHOCKED

“I was shocked when the bidding ended,” he said. “I had expected it to continue. We believe that we offered the higher bid. I was shocked when it was awarded to American Harness Tracks.”

Shick said Uzzi had not announced that after-bid offerings would not be considered.

“I had expected (this bidding) would continue after the money available at the closing was exhausted. I had been prepared to continue the post-closing bidding.”

He noted that the $4.3 million bid due at closing is predicated on all hurdles being cleared. This includes approval by the Pennsylvania Harness Commission and lining up investors and financing.

“In this (economic market) nothing is a sure thing.”

He declined to share more of his plans, noting a confidentiality agreement with Centaur and the courts prevents it.

The position of Centaur and Innovative Capital Investment Bankers rejecting value deferred consideration is particularly surprising because the duo had accepted that condition earlier this year.

In July, Centaur sold its Fortune Valley Hotel and Casino in Central City, Colo., to Michigan-based Luna Gaming for $10 million — $7.5 million in cash and a $2.5 million promissory note to be paid over five years at 6.5 percent interest. That sale and those conditions were approved Aug. 25 by the bankruptcy court.

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