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DAYTONA BEACH, Fla. -- International Speedway Corporation on Friday announced the following:
The Company will acquire the assets of Martinsville Speedway, which hosts two NASCAR Nextel Cup Series events annually, for $192 million. The acquisition will be funded by $100.4 million in proceeds from the sale of the assets of North Carolina Speedway, which currently hosts one NASCAR Nextel Cup event annually, and $91.6 million in cash.
Speedway Motorsports, Inc. will purchase North Carolina for $100.4 million, as per the terms of a settlement agreement in the Ferko/Vaughn litigation filed with the United States District Court for the Eastern District of Texas, Sherman Division. The Settlement Agreement releases ISC and NASCAR from all claims related to the litigation. The released claims include, but are not limited to, allegations or assertions with respect to the awarding and/or sanctioning of races, the effect of the common control of NASCAR and ISC residing in the France Family Group, and the market power either individually or jointly of NASCAR and ISC.
Separately, the Company received NASCAR's approval for the realignment of several NASCAR Nextel Cup races within its portfolio beginning in 2005. The net result is the addition of a second Cup event for Phoenix International Raceway and the reduction of Darlington Raceway's event schedule by one Cup date. ISC also intends for Nazareth Speedway's NASCAR Busch and IRL IndyCar events to be realigned to other facilities within its portfolio and will cease major motorsport event operations at the facility after completion of the track's 2004 events.
Martinsville acquisition and Ferko/Vaughn settlement
The acquisition of Martinsville and the sale of North Carolina will happen in a series of transactions that will essentially occur simultaneously. Martinsville is privately owned, and the France family, which controls in excess of 60 percent of the combined voting interest of ISC, indirectly owns 50 percent of Martinsville. The addition of an incremental NASCAR Nextel Cup date resulting from the Transactions was integral to the Company's decision to settle the Ferko/Vaughn litigation through the sale of North Carolina.
Located in Virginia near Greensboro and Winston-Salem, Martinsville is one of only two one-half mile tracks on the NASCAR Nextel Cup Series circuit. It seats 63,000 grandstand spectators and offers premium accommodations in the facility's 25 suites. The facility annually conducts two NASCAR Nextel Cup events, including one during the Chase for the NASCAR Nextel Cup. In addition, Martinsville hosts two NASCAR Craftsman Truck Series races and a Late Model Stock Car event annually.
"Martinsville has a long and rich tradition of world-class racing since its inception in 1947 and will be a prized addition to ISC," stated Lesa France Kennedy, President of ISC. "With Martinsville, we add two successful Nextel Cup events that have sold out annually for over a decade, which is a testament to the commitment and hard work of Clay Campbell and his team. We believe we can help build upon their successes through our expertise and strong relationships with corporate partners. The facility, which has made significant capital improvements over the past several years, affords us expansion opportunities such as seat and suite additions, as well as increased revenue opportunities from additional corporate spending. Martinsville has a passionate and devoted fan base, and we will continue to offer these customers a premium race experience. We are pleased to welcome Martinsville to the ISC family and look forward to a successful future with Clay and the rest of the outstanding employees at Martinsville."
Under the terms of the Settlement Agreement, SMI will purchase North Carolina for $100.4 million in cash. The sale of North Carolina is expected to close following the satisfaction of conditions as provided in the North Carolina Asset Purchase Agreement and the Settlement Agreement. The Settlement Agreement is subject to Court approval, which the Company anticipates receiving within the next 30 to 45 days.
Ms. France Kennedy commented, "We have always viewed Martinsville as a uniquely attractive asset, and, while it is disappointing for us to part with North Carolina, the long-term strategic and financial rationale for the Transactions is clear. We believe the lawsuit is without merit, the likelihood of a material adverse outcome would have been remote, and we would have ultimately prevailed in the litigation. However, the Transactions created the opportunity for us to gain an incremental Cup date for our portfolio and settle the lawsuit. Furthermore, the Transactions will be immediately accretive and are consistent with our long-term strategy of growing our portfolio of high-quality tracks and major race dates. We can now focus all of our time and resources on enhancing value for our shareholders."
The purchase prices for the assets of both facilities are subject to certain non-material adjustments and prorations at closing, and both are expected to close within the next 30 to 45 days in ISC's third quarter. ISC expects to record an approximate $36 million after-tax gain, or $0.68 per diluted share, from the sale of North Carolina and will reflect the facility's operations as discontinued in the Company's financial statements in accordance with generally accepted accounting principles.
Significant realignment initiatives announced for 2005
NASCAR has approved ISC's proposal for the realignment of several Nextel Cup dates, including races at Phoenix, Darlington and California Speedway. As detailed in the 2005 NASCAR Nextel Cup Series schedule released this morning, Phoenix will host an additional NASCAR Nextel Cup event, Darlington will now conduct one Nextel Cup race, and California's Spring Nextel Cup weekend will move to the week after the Daytona 500 in February. The race date realignment is expected to result in a positive incremental impact to the Company's revenue and earnings beginning in 2005.
The Company also announced it intends to realign the NASCAR Busch and IRL IndyCar series events from Nazareth to other facilities in its portfolio.
"The second Cup date in Phoenix strengthens our national presence and raises our value to our marketing and broadcast partners, providing another opportunity for them to access this key market," commented John R. Saunders, Executive Vice President and Chief Operating Officer of ISC. "In addition, race fans in the Southwest will have another opportunity to experience the excitement of live NASCAR Nextel Cup racing. We will install lighting at Phoenix in order for the facility's 2005 spring race to finish under the lights during east coast prime time, typically a time of day with larger television audiences. Also, by realigning Nazareth's Busch and IRL events to other facilities in our portfolio, we believe we can successfully grow these events over the long term at a quicker rate than in their current venue. As such, we are presently working with the various sanctioning bodies involved."
ISC will record a non-cash pre-tax charge of approximately $13 million, or $0.14 per diluted share, to reflect the impairment of Nazareth's long-lived assets
Hopefully they won't try to get rid of Martinsville like they did to North Carolina and Darlington.
DAYTONA BEACH, Fla. -- International Speedway Corporation on Friday announced the following:
The Company will acquire the assets of Martinsville Speedway, which hosts two NASCAR Nextel Cup Series events annually, for $192 million. The acquisition will be funded by $100.4 million in proceeds from the sale of the assets of North Carolina Speedway, which currently hosts one NASCAR Nextel Cup event annually, and $91.6 million in cash.
Speedway Motorsports, Inc. will purchase North Carolina for $100.4 million, as per the terms of a settlement agreement in the Ferko/Vaughn litigation filed with the United States District Court for the Eastern District of Texas, Sherman Division. The Settlement Agreement releases ISC and NASCAR from all claims related to the litigation. The released claims include, but are not limited to, allegations or assertions with respect to the awarding and/or sanctioning of races, the effect of the common control of NASCAR and ISC residing in the France Family Group, and the market power either individually or jointly of NASCAR and ISC.
Separately, the Company received NASCAR's approval for the realignment of several NASCAR Nextel Cup races within its portfolio beginning in 2005. The net result is the addition of a second Cup event for Phoenix International Raceway and the reduction of Darlington Raceway's event schedule by one Cup date. ISC also intends for Nazareth Speedway's NASCAR Busch and IRL IndyCar events to be realigned to other facilities within its portfolio and will cease major motorsport event operations at the facility after completion of the track's 2004 events.
Martinsville acquisition and Ferko/Vaughn settlement
The acquisition of Martinsville and the sale of North Carolina will happen in a series of transactions that will essentially occur simultaneously. Martinsville is privately owned, and the France family, which controls in excess of 60 percent of the combined voting interest of ISC, indirectly owns 50 percent of Martinsville. The addition of an incremental NASCAR Nextel Cup date resulting from the Transactions was integral to the Company's decision to settle the Ferko/Vaughn litigation through the sale of North Carolina.
Located in Virginia near Greensboro and Winston-Salem, Martinsville is one of only two one-half mile tracks on the NASCAR Nextel Cup Series circuit. It seats 63,000 grandstand spectators and offers premium accommodations in the facility's 25 suites. The facility annually conducts two NASCAR Nextel Cup events, including one during the Chase for the NASCAR Nextel Cup. In addition, Martinsville hosts two NASCAR Craftsman Truck Series races and a Late Model Stock Car event annually.
"Martinsville has a long and rich tradition of world-class racing since its inception in 1947 and will be a prized addition to ISC," stated Lesa France Kennedy, President of ISC. "With Martinsville, we add two successful Nextel Cup events that have sold out annually for over a decade, which is a testament to the commitment and hard work of Clay Campbell and his team. We believe we can help build upon their successes through our expertise and strong relationships with corporate partners. The facility, which has made significant capital improvements over the past several years, affords us expansion opportunities such as seat and suite additions, as well as increased revenue opportunities from additional corporate spending. Martinsville has a passionate and devoted fan base, and we will continue to offer these customers a premium race experience. We are pleased to welcome Martinsville to the ISC family and look forward to a successful future with Clay and the rest of the outstanding employees at Martinsville."
Under the terms of the Settlement Agreement, SMI will purchase North Carolina for $100.4 million in cash. The sale of North Carolina is expected to close following the satisfaction of conditions as provided in the North Carolina Asset Purchase Agreement and the Settlement Agreement. The Settlement Agreement is subject to Court approval, which the Company anticipates receiving within the next 30 to 45 days.
Ms. France Kennedy commented, "We have always viewed Martinsville as a uniquely attractive asset, and, while it is disappointing for us to part with North Carolina, the long-term strategic and financial rationale for the Transactions is clear. We believe the lawsuit is without merit, the likelihood of a material adverse outcome would have been remote, and we would have ultimately prevailed in the litigation. However, the Transactions created the opportunity for us to gain an incremental Cup date for our portfolio and settle the lawsuit. Furthermore, the Transactions will be immediately accretive and are consistent with our long-term strategy of growing our portfolio of high-quality tracks and major race dates. We can now focus all of our time and resources on enhancing value for our shareholders."
The purchase prices for the assets of both facilities are subject to certain non-material adjustments and prorations at closing, and both are expected to close within the next 30 to 45 days in ISC's third quarter. ISC expects to record an approximate $36 million after-tax gain, or $0.68 per diluted share, from the sale of North Carolina and will reflect the facility's operations as discontinued in the Company's financial statements in accordance with generally accepted accounting principles.
Significant realignment initiatives announced for 2005
NASCAR has approved ISC's proposal for the realignment of several Nextel Cup dates, including races at Phoenix, Darlington and California Speedway. As detailed in the 2005 NASCAR Nextel Cup Series schedule released this morning, Phoenix will host an additional NASCAR Nextel Cup event, Darlington will now conduct one Nextel Cup race, and California's Spring Nextel Cup weekend will move to the week after the Daytona 500 in February. The race date realignment is expected to result in a positive incremental impact to the Company's revenue and earnings beginning in 2005.
The Company also announced it intends to realign the NASCAR Busch and IRL IndyCar series events from Nazareth to other facilities in its portfolio.
"The second Cup date in Phoenix strengthens our national presence and raises our value to our marketing and broadcast partners, providing another opportunity for them to access this key market," commented John R. Saunders, Executive Vice President and Chief Operating Officer of ISC. "In addition, race fans in the Southwest will have another opportunity to experience the excitement of live NASCAR Nextel Cup racing. We will install lighting at Phoenix in order for the facility's 2005 spring race to finish under the lights during east coast prime time, typically a time of day with larger television audiences. Also, by realigning Nazareth's Busch and IRL events to other facilities in our portfolio, we believe we can successfully grow these events over the long term at a quicker rate than in their current venue. As such, we are presently working with the various sanctioning bodies involved."
ISC will record a non-cash pre-tax charge of approximately $13 million, or $0.14 per diluted share, to reflect the impairment of Nazareth's long-lived assets
Hopefully they won't try to get rid of Martinsville like they did to North Carolina and Darlington.
