Magna Entertainment Corp. announces entry into multi-year technology license agreement for STREUfex(TM) horse bedding product



    AURORA, ON, Aug. 27 /CNW/ - Magna Entertainment Corp. ("MEC")
(NASDAQ:   MECA; TSX: MEC.A) announced today that its wholly-owned subsidiary,
FEX Straw Manufacturing Inc. ("FEX"), has entered into a Technology License
Agreement with Premier Equine Products Pty Ltd. ("PEP"). Under the agreement,
FEX has licensed to PEP the exclusive right to manufacture and sell
STREUfex(TM) horse bedding product in Australia, New Zealand, Hong Kong,
Macau, Japan and Singapore for 20 years. In consideration, FEX received a
one-time up-front license fee and will receive ongoing royalty fees over the
duration of the agreement based on the number of tons of STREUfex manufactured
by PEP. In the event that PEP enters into any sublicense agreement, FEX will
further be entitled to a sublicense fee as well as similar annual product
sales-based fees.
    "We are thrilled at this tremendous international growth opportunity for
our highly absorbent, environmentally friendly product," says Johann Payerl,
General Manager of FEX, "Entering into an international joint venture with
Premier Equine Products speaks volumes about the superior nature of STREUfex.
We look forward to working closely together with our new partner to grow the
business in Asia and Australia."
    "The STREUfex product fits very well with our focus on sustainable
environmental performance and has been very successfully trialed with some of
Australia's leading trainers," says Tim Rourke, Director of Premier Equine
Products, "and we are excited to build on its North American and Austrian
success in the Australian and wider South East Asian Region. We have started
what we expect to be a mutually beneficial long-term relationship and
partnership with FEX."
    FEX manufactures STREUfex horse bedding for the North American market
from a state-of-the-art manufacturing facility in Lumberton, North Carolina.
STREUfex is a straw-based bedding product with superior absorption that
decomposes quickly into organic fertilizer. The STREUfex product was
introduced to North America in the first quarter of 2004 and currently
supplies horse bedding to Gulfstream Park and the Palm Meadows Training
Center.
    Premier Equine Products is an Australian company that specializes in the
provision of feed and bedding solutions, and the associated products and
services, to the equine industry. The company is focused on the timely
delivery of consistent, high quality and cost effective products to the equine
industry.

    MEC, North America's largest owner and operator of horse racetracks,
based on revenue, acquires, 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 AmTote
International, Inc., a provider of totalisator services to the pari-mutuel
industry, XpressBet(R), a national Internet and telephone account wagering
system, as well as MagnaBet(TM) internationally. Pursuant to joint ventures,
MEC has a fifty percent interest in HorseRacing TV(TM), a 24-hour horse racing
television network, and TrackNet Media Group LLC, a content management company
formed for distribution of the full breadth of MEC's horse racing content.

    This media release contains "forward-looking statements" within the
meaning of applicable securities legislation, including Section 27A of the
United States Securities Act of 1933, as amended (the "Securities Act"), and
Section 21E of the United States Securities Exchange Act of 1934, as amended
(the "Exchange Act") and forward-looking information as defined in the
Securities Act (Ontario) (collectively referred to as forward-looking
statements). These forward-looking statements are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995 and
the Securities Act (Ontario) and include, among others, statements regarding
the expected impact of entering into the technology license agreement.
    Forward-looking statements should not be read as guarantees of future
performance or results, and will not necessarily be accurate indications of
whether or the times at or by which such performance or results will be
achieved. Undue reliance should not be placed on such statements. Forward-
looking statements are based on information available at the time and/or
management's good faith assumptions and analyses made in light of our
perception of historical trends, current conditions and expected future
developments, as well as other factors we believe are appropriate in the
circumstances and are subject to known and unknown risks, uncertainties and
other unpredictable factors, many of which are beyond the Company's control,
that could cause actual events or results to differ materially from such
forward-looking statements. Factors that could cause actual results to differ
material y from our forward-looking statements include, but may not be limited
to, material adverse changes: in general economic conditions, the popularity
of racing and other gaming activities as recreational activities, the
regulatory environment affecting the horse racing and gaming industries, and
our ability to develop, execute or finance our strategies and plans within
expected timelines or budgets. In drawing conclusions set out in our
forward-looking statements above, we have assumed, among other things, that
there will not be any material adverse changes: in general economic
conditions, the popularity of horse racing and other gaming activities, the
regulatory environment, and our ability to develop, execute or finance our
strategies and plans as anticipated.
    Forward-looking statements speak only as of the date the statements were
made. We assume no obligation to update forward-looking statements to reflect
actual results, changes in assumptions or changes in other factors affecting
forward-looking statements. If we update one or more forward-looking
statements, no inference should be drawn that we will make additional updates
with respect thereto or with respect to other forward-looking statements.




For further information:

For further information: Blake Tohana, Executive Vice-President and
Chief Financial Officer, Magna Entertainment Corp., 337 Magna Drive, Aurora,
ON, L4G 7K1, Tel: (905) 726-7493

Organization Profile

MAGNA ENTERTAINMENT CORP.

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