NASCAR Fans E-mail List Rockingham Battle Rages on by Jon McClintock RaceWire- The financial world is taking a close look at motorsports now that two major players are like dogs, eye to eye over a bone, waiting for the other to blink....
NASCAR Fans E-mail List
Rockingham Battle Rages on
by Jon McClintock
RaceWire- The financial world is taking a close look at motorsports now that two major players are like dogs, eye to eye over a bone, waiting for the other to blink.
One brokerage firm boosted Penske Speedways (SPWY) to a "strong buy" recommendation Thursday, even while Bruton Smith of Speedway Motorsports (TRK) was announcing that the owners of North Carolina Motor Speedway (NCMS) must accept his higher bid, or risk a "tremendous lawsuit."
These aren't too ordinary pit bulls. Penske's associates call the aloof but successful former driver "The Boss", while Smith has built a miniature racing empire in just two years - an emotional time which included buying half the rights to a NASCAR short track, then assigning its race date to his new Texas Motor Speedway (this Sunday).
The "bone" is the popular one-mile speedway known as "The Rock" and each combatant has his teeth on the prize. Smith currently owns 24% of the track's estimated 2.2 million outstanding shares, while Penske owns 4.5%. Smith seemed to have given up an earlier takeover bid when Penske bought his piece of the Rock two years ago. Speedway Motorsports went on to acquire half of North Wilkesboro Speedway, an antiquated short track still on the Winston Cup circuit, while New Hampshire International Speedway owner Bob Bahre bought the other half. The two each took one of the tracks dates and the facility is currently inactive.
NCMS, however, just went through a major facilities upgrade and its future seemed assured. When Penske Speedways announced Tuesday it had reached agreement to buy a 62% block of stock owned by Carrie DeWitt for an estimated $28 million, it appeared to be a routine and logical expansion.
24 hours later, Smith upped the ante - a 60% higher bid - characterizing himself as a "white knight."
Smith isn't waiting for Penske to blink.
"Our offer was a 60 percent increase over what Roger Penske's offer was," he told UPI. "When somebody puts a corporation into play, we came in with a much, much better offer and increased it by 60 percent.
"It's the law that you sell to the highest bidder. If you are a stockholder and now the corporation is in play, your desire is to get the top dollar for your stock. They have to sell to the highest bidder. The board would subject themselves to a tremendous lawsuit if they took a lesser price for their stock."
A Penske spokesman says PSI doesn't intend to take the Winston Cup dates from NCMS. Dow Jones news service quotes Speedway Motorsports spokesman Jerry Gappens as saying it's too early to say what the future holds for NCMS - that future use would be determined by its potential earnings.
No acquisition guarantees a race date, since NASCAR awards the precious events on an annual basis. And while NASCAR owner Bill France, Jr. has a financial interest (through International Speedway Corporation stock) in Penske Speedways, he's apparently walked a tight line in satisfying Smith's expansion effort.
Some say it's fear of a break-away series, just as happened with Indy-style sanctioning. Others note the potential anti-trust ramifications.
More immediately, NCMS spokesman Chris Browning declines comment on the high-stakes tug of war that has Wall Street - and fans - watching.
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