AN INTRIGUING STANDARDBRED-TO-THOROUGHBRED RACING TRANSITION

Two of the most renowned racehorse trainers of all time are Bob Baffert and Wayne Lukas.  Both started out running Quarter Horses and then transitioned to Thoroughbreds, where each had immediate and lasting success.  Now an eminent name from Standardbred racing is aiming to make his mark in Thoroughbred racing.

According to Bill Finley in Harness Racing Update, retired Standardbred Hall of Fame trainer Jimmy Takter has partnered with Philip Antonacci to purchase and race Thoroughbreds.  Antonacci already owns some Thoroughbreds, trained by Wesley Ward, but the Antonacci/Takter venture will be a separate operation, beginning with 15 horses stabled at Payson Park in Florida, with Antonacci as the trainer of record.

The Swedish-born Takter had an amazing record of accomplishment.  When he retired in 2018 at age 58, he had trained the winners of four Hambletonians, six Hambletonian Oaks, and 34 Breeders Crowns.

Antonacci was a student in the prestigious Godolphin Flying Start program.  His program bio reads:

“Philip Antonacci comes from Somersville, Connecticut and graduated in 2017 from the University of Pennsylvania, with a BA in History. Before commencing the Godolphin Flying Start program he worked as an intern with Gai Waterhouse Racing and with Lindy Farms as a sales intern. Philip completed his USA phase externship with Todd Pletcher and his Australian phase externship with Boomer Bloodstock.

On completing the Godolphin Flying Start in 2019, Antonacci was hired by Dave Reid at Preferred Equine to fill the role of Director of Sales for its Thoroughbred division.”

It will be interesting, to say the least, to see how the skill set of one of the very best Standardbred trainers of all time transfers to flat racing. Seemingly, the path of Baffert and Lukas was easier, in that Quarter Horse racing is a form of flat racing with jockeys aboard, and Takter will have a much steeper learning curve in terms of bloodlines, conformation, and training methods. Then too, Antonacci is an unknown quantity as a Thoroughbred trainer.

Copyright © 2020 Horse Racing Business

WEALTHIEST AMERICAN RACEHORSE OWNERS IN 2020

The annual Forbes 400 for 2020 is out and it includes at least five billionaires who are prominent racehorse owners. Two of them are part owners of recent Kentucky Derby winners.

The wealthiest racehorse owner/breeder (with farms in Ireland and the United States) at number 96 on the Forbes 400 is John Malone, who made his fortune in cable television and has an estimated net worth of $6.5 billion.   The remaining four are Gayle Benson, widow of Tom Benson and owner of GMB Racing (number 249/400 on the Forbes 400 at $3.3 billion); B. Wayne Hughes, self-storage pioneer, owner of renowned Spendthrift Farm, and co-owner of 2020 Kentucky Derby winner Authentic (number 299/400 at $2.8 billion); Brad Kelley, owner of famed Calumet Farm (number 339/400 at $2.5 billion); and Vincent Viola, electronic trading entrepreneur, owner of St. Elias Stables and co-owner of 2017 Kentucky Derby winner Always Dreaming (number 339/400 at $2.5 billion).

Forty-two members on the Forbes 400, with a combined net worth of $271 billion, own controlling stakes in teams in major sports leagues.  Two of them—Gayle Benson and Vincent Viola—are racehorse owners.  Ms. Benson owns the New Orleans Pelicans of the National Basketball Association and the New Orleans Saints of the National Football League, while Mr. Viola owns the Florida Panthers of the National Hockey League.

(After the Forbes rankings were published, another member of the Forbes 400, Steve Cohen, became the 43rd controlling owner of a major sports team, when he purchased 95% of the New York Mets baseball club for the highest price ever paid for an American sports franchise, $2.4 to $2.5 billion).

Copyright © 2020 Horse Racing Business

ECONOMICS OF THE AMERICAN JOCKEY CLUB 140-MARE LIMIT by ROBERT L. LOSEY, PH.D.

On May 7, 2020, the Jockey Club issued a rule limiting stallions under its jurisdiction born after 2019 to breeding a maximum of 140 mares annually in North America.  The limits placed on mares bred for stallions born 2020 and later put them at a financial disadvantage relative to stallions born before 2020 and will lead to at least four significant changes in the economics of stallion markets.

  • Very popular stallion prospects born in the United States after 2019 will be worth less in North America.
  • Very popular new stallions will be increasingly likely to be exported or shuttled.
  • Potential stallion prospects born before 2020 and young stallions now at stud are now worth more.
  • Upper-end stallion seasons prices will trend higher starting in mid-decade.  Mid-level stallion seasons will trend upward to a lesser extent.

Before and After Stallions

While stallions born before 2020 will face no limits on mares bred, U.S. stallions born after 2019 will be limited to 140 mares throughout their careers.  An extremely popular stallion born in 2020 that is retired to stud in mid-decade may have bred 252 mares (as Triple Crown champion Justify did in 2019) in the absence of the 140-mare limit, but will find that 112 mares he might have previously bred will be displaced to other stallions.  That future version of Justify will logically command a higher stud fee in light of the Jockey club limit on mares bred, but the lower number of mares bred will cause a decline in his breeding revenues. 

The 112 mares redirected to other stallions from future stallions like Justify born after 2019 will increase demand for other stallions.  The increased demand will be absorbed by multiple replacement stallions, and will initially result in very modest, perhaps even no perceptible increases in posted prices for replacement stallions.  But each passing year will find more new stallions subject to the 140-limit being retired, and the rising demand for alternative stallions generated by the increasing number of displaced mares will cause prices of stallion seasons to rise, most especially for elite stallions.  By 2040, stallion season prices at the upper levels will be higher than they otherwise would have been by 20% or so, with mid-level season prices rising relative to where prices would have been absent a limit on mares bred.

More Exported and Shuttle Stallions

Popular new stallions subject to the 140 limit that appeal to European and Japanese markets will be more likely to be in play for export.  Being able to breed 200 or more mares overseas rather than 140 in the U.S. during the early years at stud may significantly increase the now rare phenomenon of popular new U.S. stallions being exported at the start of their breeding careers; and a less stressful Northern Hemisphere breeding environment for new stallions subject to the 140-limit, coupled with increased financial pressures, may increase the likelihood of new U.S.-based stallions being shuttled.

Price Adjustments for Stallions and for Racing Prospects

Had the September 2019 Jockey Club proposal on breeding limits been implemented without change for 2021, most stallion season prices for commercial stallions would have experienced substantial immediate increases.  But because the May 2020 Jockey Club rule phases in mare limits gradually, price changes arising from the phase-in of the 140-mare limit will occur gradually over the next 15 years or so, though with one significant “break point.”

Fertile stallions born before 2020 that face no limits on mares bred will be worth significantly more than similar quality stallions born in 2020 or later. Other things equal though, a stallion born in 2019 will be worth a bit more than a stallion born in 2018.  In the early part of this decade, we should expect to see newly retired stallions born before 2020 be worth more each successive year.  This is because these younger stallions will not be subject to the 140-mare limit that can potentially decrease revenues.  Stallions born after 2019 will find that their values will be substantially diminished because of the 140-mare limit.

An extensive discussion of this topic can be accessed at https://ir.library.louisville.edu/faculty/445/

Robert L. Losey can be contacted at rllosey@gmail.com