A Bloomberg article states that Churchill Downs Inc. is investigating a possible divestment of its internet-based horse race betting platform, TwinSpires. Being the official wagering associate of renowned events such as the Kentucky Derby, TwinSpires occupies a leading role in the sector. This announcement has generated considerable buzz, causing a surge in the company’s share value.
Although Churchill Downs has not issued an official statement on the subject, sources indicate that the Louisville-headquartered corporation is actively collaborating with consultants to identify a suitable purchaser for the platform. While a substantial valuation of $1.5 billion has been suggested, it’s crucial to emphasize that no definitive resolutions have been reached, and Churchill Downs retains authority over the process.
This situation has reverberated throughout the market, propelling the company’s worth to $8.8 billion, with stock prices reaching $236.26. The prospective sale follows a period of robust performance by TwinSpires, with its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for the third quarter of 2021 hitting $31.2 million, a notable 56% year-on-year increase. This expansion is further highlighted by a 31% rise in handle for TwinSpires’ horse racing division between the third quarter of 2019 and the third quarter of 2021.