Duchossois family, once largest shareholders in Churchill Downs, sells back 1 million shares
Churchill Downs Inc., owner of Arlington International Racecourse, has repurchased 1 million shares of its stock from The Duchossois Group in a private transaction that was scheduled to close Tuesday.
The action is one more in a line of previous stock repurchases going back to 2015 when the group, controlled by Arlington Chairman Emeritus Richard Duchossois and his son Craig, were the largest single bloc of shareholders in the Louisville-based horse racing and gambling corporation.
And it comes as the storied 94-year-old Arlington Heights oval prepares to run what may be its final season, amid an uncertain future. The track applied for and received state permission for 68 live racing dates starting April 30, but Churchill Downs CEO Bill Carstanjen's comments last summer -- that the track could run a 2021 meet "if we elect to do so" -- cast doubt about the track opening at all.
In the July 30, 2020, quarterly earnings call with investors, Carstanjen also declared that the land on which Arlington sits would have "a higher and better purpose for something else at some point."
Under terms of the stock repurchase agreement released Tuesday, CDI Holdings LLC, an affiliate of The Duchossois Group, sold 1 million of its 3 million shares at a price of $193.94 per share, for a total price of $193.9 million.
Craig Duchossois said the sale is part of the family's plan to diversify its holdings, after the Churchill stock grew to become a large percentage of family assets.
"This was really nothing other than taking some off the table after a long and successful run," Duchossois said Tuesday night. "My father and I have extraordinary confidence in the leadership team at Churchill."
As to the precarious future of Arlington Park, Duchossois said it's in the hands of Churchill corporate leadership.
"My father and I have been off the board for a number of years. That's Churchill's property," Duchossois said. "Ever since our merger in 2000, we've not really controlled the destiny of Arlington, although it is my father's love and passion, and he worked wonderfully well with the Churchill people.
"All the shots for Arlington and racing in Illinois are Churchill's responsibility," he added. "The family is not in a leadership position anymore."
The Duchossois family became Churchill's largest shareholders when their racetrack merged with Churchill some two decades ago.
Richard, now 99, retired from the Churchill board of directors in April 2019, and Craig stepped down a year before that. Both are still considered emeritus directors by the company.
The stock repurchase deal leaves The Duchossois Group with 2 million shares, Richard Duchossois with 617,773 and Craig Duchossois with 120,000, according to a Churchill Downs filing with the U.S. Securities and Exchange Commission on Tuesday.
All together, the Duchossois family controls 7.1% of Churchill stock.
While the family still holds a major stake, Churchill's largest shareholders are BlackRock Institutional Trust Co., Fidelity Management & Research Co. and The Vanguard Group, according to Churchill's website.
In June 2017, The Duchossois Group sold 1 million shares in a transaction with Churchill worth $158.8 million.
That was preceded by a sale of nearly 945,000 shares for $138.1 million in November 2015.