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Great Lakes Downs to end after 2007 meet

19 January 2007

AURORA, Ontario – (PRESS RELEASE) -- Magna Entertainment Corp. ("MEC") (NASDAQ: MECA) today announced that the 2007 race meet will be the last meet that it will operate Great Lakes Downs, a thoroughbred racetrack located in Muskegon, Michigan. This decision was made as a result of continuing and forecast operational losses at Great Lakes Downs.

Over the years, MEC has worked diligently with the Michigan horsemen, the Office of the Racing Commissioner and other State and local government officials in an attempt to improve the viability of horse racing at Great Lakes Downs and in Michigan generally. However, without significant changes in the regulatory environment that restricts horseracing from competing on a level playing field with other forms of gaming and entertainment, MEC has been unable to make Great Lakes Downs profitable. Great Lakes Downs is expected to generate a pre-tax loss of approximately $1.8 million for the year ended December 31, 2006.

MEC strongly believes in the future of horse racing and continues to invest in racing in jurisdictions which facilitate our ability to accept wagering through the internet, off-track betting and video wagering terminals. MEC very much regrets the decision to discontinue operating Great Lakes Downs, which will affect the lives of many people involved in the Michigan horse racing industry, but MEC cannot continue to subsidize horse racing in Michigan with no prospect of future profitability. In order to give horsemen sufficient time to adjust, MEC has agreed to operate Great Lakes Downs through its 2007 meet. Should the regulatory environment become more conducive to horseracing in Michigan and permit race track operations to compete on a level playing field, MEC would be prepared to reconsider this decision.

MEC is North America's largest owner and operator of horse racetracks, based on revenue. It develops, owns and operates horse racetracks and related pari-mutuel wagering operations, including off-track betting facilities. MEC also develops, owns and operates casinos in conjunction with its racetracks where permitted by law. MEC owns and operates XpressBet®, a national Internet and telephone account wagering system, and Horse Racing TV(TM), a 24-hour horse racing television network, as well as MagnaBet(TM) internationally.

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