Churchill Downs begins first step of content pivot with United Tote sale
TwinSpires operator sheds 49% stake in horseracing business to New York Racing Association
Churchill Downs Incorporated (CDI) has sold a 49% stake in United Tote Company to the New York Racing Association (NYRA).
Financial terms of the sale have not been disclosed by either party.
As part of the agreement, United Tote’s pari-mutuel settlements business will be excluded from the sale and will remain with CDI for a fixed period.
“CDI and NYRA intend to work together to create and provide a comprehensive and efficient industry-leading pari-mutuel solution through United Tote that will expedite the expansion of horseracing seamlessly onto sports wagering platforms to reach new customers,” CDI said in a statement.
Pending the appropriate regulatory approvals, NYRA will transition its pari-mutuel wager processing to United Tote in 2023 under a separate agreement.
The sale comes as part of CDI’s new business strategy of becoming a B2B content-led horseracing business following the decision to close the TwinSpires online sportsbook and casino business amid rising losses with the online sportsbook brand.
Churchill Downs is set to report a $5m loss from the TwinSpires business by the end of its 2022 financial year and has committed to wholesale changes.
While TwinRiver’s racebook will run as a separate brand, CDI has committed to developing a B2B offering running in tandem which will focus on the delivery of content and data to sportsbook partners.
The B2B business will also focus on providing ancillary services and user interface technology to businesses in the horseracing space.
In preparation for this entry, Churchill Downs has developed a strategy aimed at addressing process, content, and technology issues in order to deliver a seamless product to B2B partners.
Set up as a non-profit corporation, the NYRA operates the three largest thoroughbred horseracing tracks in the state of New York: Aqueduct Racetrack in South Ozone Park, Queens; Belmont Park in Elmont, and Saratoga Racecourse in Saratoga Springs.
NYRA serves as business partner to Caesars Entertainment’s racebook product, which operates in Montana, Oregon, and Florida, with plans to launch in Ohio when permissible.
The transaction, which is subject to regulatory approval, is expected to close by the end of 2022.