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Patriot to Buy Racetrack Businesses

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Times Staff and Wire Reports

Patriot American Hospitality Inc. said it agreed to acquire racetrack concerns California Jockey Club and Bay Meadows Operating Co. for about $195 million in stock. Patriot, a real-estate investment trust based in Dallas, said it will pay about $33 for each share of California Jockey and Bay Meadows, whose stock trades as a single unit on the American Stock Exchange; the shares soared 34% on the news, rising $8.375 to close at $33.25. Bay Meadows operates the Bay Meadows Racecourse in San Mateo, which is the principal asset of California Jockey. Patriot American will merge its operations into California Jockey Club, assuming its “paired share” ownership structure. California Jockey is one of four real estate investment companies in the U.S. grandfathered under federal tax law to use the structure. Patriot American shares climbed 87.5 cents to $35.125 on NYSE. The acquisition is expected to close early next year.

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