Magna Entertainment reorganization plan subject to court confirmation hearing

Magna confirmation hearing begins

WILMINGTON, Del. — A bankruptcy judge has begun a hearing on whether to confirm horse track owner Magna Entertainment Corp.’s reorganization plan by rejecting a shareholder request to appoint an independent examiner in the case.

The judge on Tuesday also denied a request to appoint an official committee of equity holders, saying Magna shareholders waited too long to take action.

The shareholders are challenging how the reorganization plan values Magna and say the plan allows parent company MI Developments to acquire Magna assets to the detriment of other creditors and remaining shareholders.

Magna filed a reorganization plan in February. It depends on settling a lawsuit in which its official creditors committee accused MI Developments of sham financial transactions leading th Magna’s bankruptcy.