Everett Backers Propose to Sell Hollywood Park

The battle for control of Hollywood Park took another turn Tuesday with the announcement of a proposal that the Inglewood race track be put up for sale.

The proposal was made to Hollywood Park Realty by a committee of seven directors who serve on the board of the Hollywood Park Operating Co. The operating company leases Hollywood Park from the realty company, and publicly traded shares in the track are paired on the stock exchange.

Marje Everett, chief executive officer of the track, is the target of a proxy fight initiated by R.D. Hubbard, international glassmaking executive, who is a major owner of race tracks in Kansas and New Mexico.

In effect, the suggestion that Hollywood Park be sold is Everett’s first response to shareholders in her battle to avoid being replaced by Hubbard.

In a statement, Everett said that selling Hollywood Park is being proposed “to assure stockholders of the opportunity to receive the maximum possible value from their shares.”

Besides Everett, other members of the sell-the-track committee are Merv Griffin, John Forsythe, Aaron Spelling, Allen Paulson, Bruce McNall and Stan Seiden. Other operating company board members, who are considered opponents of Everett’s, are Harry Ornest, Tom Gamel, Warren Williamson and John Newman.

Williamson is chairman of Hollywood Park Realty, and Newman and Gamel are also board members of both the realty and operating companies.

Hubbard, who has been unsuccessful in getting elected to the board of the operating company, was recently elected to the realty company’s board, and he has announced that he is dropping a lawsuit against the track.

“The realty board will address this suggestion (of selling the track) at our meeting on Dec. 5,” Williamson said. “As for my persuasion, all of this reminds me of the trainer of questionable talent who had a stakes horse, but ran him into the ground. When the horse had dropped down to the $10,000 claiming ranks, the owner came around to change trainers, and the trainer told him that the horse was ready for the rendering plant.

“In other words, everybody knows that the real estate market has fallen on evil days, so there’s no logic to selling the place, and I’m sure this will concern other members of the board. What we have is this lady (Everett) saying that this is my sandbox, and if you try to take it away from me, I’ll fix it so that you won’t want it when you get it.”

In an attempt to oust Everett early last year, Gamel suggested that live racing be eliminated at Hollywood Park and that the track be used as a training center and as a site for off-track betting on televised races. Everett was opposed to those ideas, as well as to Gamel’s suggestion that much of Hollywood Park’s 347 acres be sold for commercial development.

Everett declined to accept a phone call Tuesday and referred a reporter to Charles Perkins, her spokesman in New York.

Asked if Hollywood Park would consider selling the track to someone who would not use it for racing, Perkins said: “There are two issues here. The property is zoned for racing, and it would be virtually impossible to get that zoning changed. Secondly, (Everett’s) people are committed to the preservation of racing at Hollywood Park.”

Hubbard was traveling in Japan Tuesday but made these comments through a spokesman: “This proposal is ill-timed and not designed to maximize shareholder value. When a director (Gamel) suggested a year ago that certain real property be sold, Marje Everett wrote . . . that ‘it would be imprudent to seize upon hasty, irresponsible and ill-conceived expedients out of a sense of panic or frustration.’ In my opinion, this current suggestion represents just such a hasty response and is being made out of either panic or frustration.”

Hubbard, who has bought about $11 million in Hollywood Park stock to become one of the track’s principal shareholders, said that any disposal of the track now would amount to “a fire sale.” He made this proposal: “A long-term investment in a well-operated track, coupled with a sale of substantial surplus real estate. Given the size of these surplus real estate holdings, their sale would amount to a significant (cash) distribution to the stockholders.”

In her statement Tuesday, Everett said:

--Hollywood Park’s debt has been reduced in the last year from $100 million to $45 million.

--The track’s third-quarter earnings totaled $1.3 million, compared to a loss of $567,000 for the same period last year.

--The track has recorded a profit of $4.6 million for the first nine months of this year, compared to a deficit of $3.7 million for the same period in 1989.

--Payment of dividends, which had been suspended for about three years, has been resumed this year.

Hollywood Park’s stock went up two points in early trading Tuesday, then closed at 34 7/8, up 7/8ths. The stock was at 19 about a year ago. With almost 4 million shares, the company has a current book value of almost $140 million.

The track’s land could be worth more than $250 million. Earlier this year, Hollywood Park received an offer of $600,000 an acre for about 25 acres. The Forum, where the Lakers and Kings play, across the street from the track, has reportedly offered Hollywood Park $20 million for a 20-acre parking lot.