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Santa Anita Owner Shares Plunge 56%
In the US, shares in Frank Stronach's Magna Entertainment Corp "plummeted by more than 50% on heavier than average volume (on Tuesday), prompting more concern for the owner of the site of next month's Breeders' Cup World Championships," reported bloodhorse.com. MEC's stock hit a low of US$1.50 before rising to US$1.75 (a 56.3% drop) at the close of trading on the NASDAQ board, with a volume of more than 218,627 soaring above the 3-month daily average of 6,427. The Wall Street Journal noted MEC's decline "was the largest percentage drop of the day", in contrast "against trading where the NASDAQ Composite Index rose nearly 5%" (rebounding from Monday's 9.14% drop). New Orleans brokerage firm Rice Voelker principal Tim Rice (also a licensed owner & trainer in Louisiana) commented: "When you see stocks do what this is doing right now, it would seem somebody knows something. It has all the appearances of being a death watch." MEC posted annual losses of more than US$520 million from 2002-2007 & lost an additional US$67.7 million in the 1st half of the current year. The company also reported in August that it had nearly US$230 million in debt due by next June (including a US$40 million senior credit facility held by a subsidiary of the Bank of Montreal, which is now scheduled to mature by October 15); the maturity date of that loan (which has been extended more than 6 times this year) "is guaranteed in part by certain assets of Santa Anita Park" (host track of the Breeders' Cup).