Amalgamation of Counties and Auckland Racing Clubs gets green light
Planned land selloff to reap up to $250 million to bankroll prize-money increases
Key participants and administrators of the New Zealand racing industry hope last night’s landmark vote, which paves the way for the formation of a Super Club following the amalgamation of Counties and Auckland Racing Clubs, can help stop the exodus of talented horses and people to overseas jurisdictions.
There were about 140 people at the meeting and it was a unanimous decision to allow the proposed merger of the two clubs to go ahead, according to Auckland Racing Club chief executive Paul Wilcox.
Counties Racing Club members on Tuesday had also given their consent to the mandate which will allow the valuable parcels of land to be sold off and the money used to generate income which can be injected back into prize-money.
The Auckland Racing Club plans to sell land at Ellerslie, worth an estimated $250 million, to housing developers.
“Selling the (steeplechase land) is critical to be able to get that monies invested of which we can make sure we retain and protect the investment and also inflation proof it,” Wilcox told ANZ Bloodstock News last night.
“We can then start using those monies to really drive those stakes increases and not be reliant on our codes (distribution of prize-money). We can actually say, ‘here’s what we get from them and we are going to add this much extra’.
“Once we’ve got that money invested and make the right decisions, we can give the trainers, owners, jockeys a good stake to race for.”
Wilcox emphasised that the huge one-off cash hit would be carefully invested by the Auckland Thoroughbred Racing Incorporated, the new entity which will come into effect from the start of the new season on August 1.
“It has to be a long-term sustained increase in prize-money, not a one-off jab,” he said.
“Our Deloitte report said we’d get between NZ$200 and NZ$250 million for the land, which we would invest.
“In our current investment portfolio we are returning over ten percent for the past seven years. For easy math, that will give us $200 million to invest, which would give us $20 million.
“You retain 24 percent of that return for inflation purposes and to grow that fund. The rest of that, which would be $15-odd million, would go straight into stakes.”
It is expected to take up to five years before Ellerslie would be hosting Saturday meetings with races worth around NZ$100,000 each.
“We are going to be shut down for 12 to 18 months to put a new (Strathayr) surface in at Ellerslie and that will happen after Cup week in March next year,” he said.
“Our ultimate goal is within that five-year timeframe to be really pushing stakes to a level that is comparable to Australia.”
A clearly passionate racing man, Wilcox wants to see participants encouraged to remain in New Zealand rather than being forced to seek opportunities internationally.
“We want to stop the likes of young, potential Chris Wallers going over to Australia to make their way and to give them an opportunity (in New Zealand),” he said.
“In New Zealand people say, ‘is my horse good enough to make it in Australia?’. Down the track, when we’ve elevated the stakes and we are a proper metropolitan club, I want people to be saying to their trainer, ‘Hey, is our horse good enough to go to Ellerslie?’
“You look at the young trainers we’ve got at the minute and there’s probably none more so than Jamie Richards. You don’t want Jamie or a Stephen Marsh or an Andrew Forsman even having to consider going to Australia.
“You want them to be able to see a future in New Zealand, racing for good money where they can get their owners to get a horse to Ellerslie and make decent money.
“We are never going to have your Everests and Kosciuszkos and your Eagles or what-have-yous, but we want to get up to par on Saturday metropolitan level so that you’re racing for similar money to what you would if it was a meeting at Randwick or Flemington.”
Kiwi agent Phill Cataldo, who identified and sourced Mick Price and Mick Kent jr’s rising star Ayrton (Iffraaj) as an unraced horse in New Zealand last year, says if regular six-figure Saturday metropolitan races come to fruition then the significant numbers of horses being exported overseas “will slow down to a point”.
“However, there are still a lot of people, and always will be, who buy horses to trade on,” Cataldo said yesterday.
“There’s been a lot of people who make a lot of money doing that and with the prize-money as low as it’s been, quite often it’s been a no-brainer to sell.
“A real trend that is happening now is that they will sell part of the horse and retain part. That way they get the money and still have the enjoyment of having a share in a horse who is racing for big prize-money in Australia.
“The Australians that are buying horses in New Zealand, they know what they are doing. They won’t buy horses that aren’t up to Saturday class normally – or not the people I work with anyway. Everyone’s looking for that Saturday horse.
“The horses that are that next level down, more of those will certainly stay here, I suppose.”
ARC chairman Doug Alderslade said after the historic vote that “the status quo simply was not sustainable and change was required”.
“With this vote and a clear mandate from our members, we now have a solid foundation to create a financially viable, internationally recognised racing club for the Auckland region that delivers for all industry participants,” he said.
“Thank you to the members of both Auckland Racing Club and Counties Racing Club for supporting a vibrant, sustainable future for thoroughbred racing across the entire Auckland region.
“Crucially, the amalgamation will allow the new club to realise significant combined assets to be reinvested into the industry, and increase stakes.”
Counties Racing Club chair and Haunui Farm studmaster Mark Chitty said: “This marks the beginning of an exciting new chapter for our industry.
“ATR will be aiming to double average stakes money per race to $100,000 to retain industry participants and attract young people into the industry.
“We have an opportunity now to ensure that the next generation of trainers, owners, breeders, jockeys, and racegoers have a reason to stay involved in our sport locally, and in the long-term.”
Fellow Auckland club Avondale’s future also lies at Ellerslie, but it plans to retain its independence rather than form part of the amalgamation.
Wilcox, who will chalk up four years in charge of Ellerslie on August 1, pledged to remain at the helm of the new entity to see through the track’s redevelopment and investment into prize-money levels.
He said: “I am a firm believer that a CEO shouldn’t be in a role for greater than five to seven years because otherwise you get stale, but my commitment to the board is as long as I am doing my job and achieving to their expectations I will see it out the other side.
“When we’ve got the new track and the elevated stakes to the level close to where we want it to be, I’ll be happy to walk away and give it to someone else to take it to the next level again.”