Magna Entertainment shareholders appeal court approval of reorganization plan

Shareholders challenge Magna reorganization

DOVER, Del. — Shareholders of horse track owner Magna Entertainment Corp. are appealing a bankruptcy judge’s approval of the company’s Chapter 11 reorganization plan.

The shareholders filed an appeal in U.S. District Court in Delaware on Thursday, the same day the bankruptcy judge signed an order approving Magna’s reorganization plan.

The shareholders are getting nothing under the plan. They want the approval stayed and the plan put on hold while their appeal is heard.

The shareholders argue that a legal settlement with unsecured creditors upon which the plan is based allows Magna parent company MI Development to acquire valuable assets for a fraction of their value while avoiding potential legal liabilities.

The assets include the Pimlico track in Baltimore and its Preakness Triple Crown race.