On Wednesday Magna Entertainment Corporation announced a transaction agreement with MI Developments Inc., or MID, its controlling shareholder, to execute a reorganization of MID.
When the agreement is implemented, Magna, the owner and operator of North American horse racetracks, will be controlled directly by the Stronach Group, an entity affiliated with Frank Stronach, Magna's chairman and chief executive.
Magna said that MID will no longer have any ownership interest, and MID will be prohibited from investing any additional funds into or entering into any new transactions with Magna without MID shareholder approval.
According to a prepared statement, Magna believes this agreement will “enable it to pursue its strategy of horse racing, gaming and entertainment on a standalone basis.”