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They Issue Second Requests For Horseracing Mergers, Don’t They?

Posted  March 5, 2010

The U.S. Department of Justice is pulling hard on the reins to slow down a proposed merger between Churchill Downs, the famous racetrack home to the Kentucky Derby, and, an online horseracing gambling website.

The DOJ has issued the companies a “second request” under the Hart-Scott-Rodino Act for additional information on the proposed merger.

Second requests are rare, and dramatically increase the transaction costs associated with a merger.  Some merger agreements even contain provisions that terminate the merger in the event of a second request.

That doesn’t appear to be the case in the Churchill merger, however.  Churchill Downs’s CEO recently stated he expects the deal to finish the second quarter of 2010. has scheduled a special meeting of stockholders on April 6 to vote on the planned merger.

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