NEWS
Vision masters
Posted: Saturday, December 16, 2000
Bloodstock agents look to the future and generally agree that supply now exceeds demand
Where are the bloodstock markets heading? When will prices reach their peaks? Or have they already done so? These questions are being posed by just about everyone in the Thoroughbred industry, and they are asked of bloodstock agents, the practitioners with their fingers on the pulse of the horse business.
Today, agents are divided; some express cautious optimism, while others are cautiously pessimistic. Such was not the case last year at this time. But a different reality appears to be approaching the doorstep now, although when exactly it will march through that door remains open to question.
Still, bloodstock markets for the most part continued to boom in 2000. Keeneland sold a record $756,575,100 in horseflesh this year. Add in the figures from other public auctions, stallion seasons and shares, and other transactions public and private, and it can be stated with certainty that Thoroughbred bloodstock annually generates billions of dollars in gross revenues in North America alone.
Once again, Thoroughbred Times is profiling 12 bloodstock agents and agencies whose activities have been prominent during the previous year. Not all of them have had high sales volumes but all have been noteworthy components in the success of the bloodstock markets. Hundreds of others have also made contributions, many of them major, and they deserve a salute with those profiled on these pages.
The bloodstock business is not glamorous. Agents are not presented with garlands of flowers in winner's circles. Rarely does a national network broadcaster interview them after a race. They spend many an early morning or late evening in the office, quietly poring over breeding statistics, catalog pages, sales results, and other industry data. Their diligence is often unappreciated by the general public, but their clients are well aware of the value that bloodstock agents provide.
All of the following profiles were written by Bill Mooney, a frequent contributor to Thoroughbred Times.
Rollin W. Baugh
Principal: Rollin W. Baugh
Location: Rancho Santa Fe, California
Founded: 1968
Focus: Stallion prospects; purchases of racing and breeding stock privately and at public auctions; syndications and partnerships; insurance
"We had the same sort of year that most of the industry did in 2000, steady and solid," said Rollin W. Baugh. "Our clients, particularly people such as Gary Biszantz, who has Cobra Farms, continue to be aggressive participants. This was the first year that Cobra's retired stallion, Old Trieste, was bred. He's at Jonabell. His first crop of mares in foal sold at Keeneland in November and drew some excellent prices.
"Alex Trabek (host of the game show "Jeopardy") increased his activity on several levels this year. Marguerite Clifford is one of my new clients, and I still do lots of work for the Japan Racing Association and other Japanese clients. Yes, these are busy times."
As a boy, Baugh used to ride his bicycle to Santa Anita Park, dreaming of the day when he might become a Thoroughbred industry participant. In 1999, he became a member of the Jockey Club.
"It's been a very long path but a very pleasing one as well," Baugh said. "The bloodstock markets are hard to predict, but I think in 2001 we'll continue the path we're currently on. The appreciation in some of the prices does bother me. They can't keep on going up and up. The top of the bloodstock game is pretty darn good, but what's underneath is not, and the further underneath you go the weaker it becomes.
"I remain very enthusiastic about what the National Thoroughbred Racing Association (NTRA) is trying to do, but I'm discouraged by the people who aren't aggressively supporting it. Too many of them are taking restrictive views, trying to operate in their own little niches, culling what profits they can, while thinking, 'Let the greater good be damned.' The Thoroughbred industry's been that way throughout the years I've been involved, marketing in a fragmented manner. This has got to stop."
Reynolds Bell Thoroughbred Services
Principal: Reynolds Bell Jr.
Location: Lexington, Kentucky
Founded: 1992
Focus: Advises and serves as agent for clients in private sales and at public auctions; stallion seasons and shares; stallion management
Reynolds Bell Jr. never has been big on self-promotion. Put the facts out there, let the people decide-that is his philosophy. "Sure, 2000 was a good year for us," Bell said, and one has to press him for details beyond that.
Bell has many prominent clients, Jayeff B Stables among them. "But the sand's always shifting in the Thoroughbred industry," he said. "I'm continually trying to bring in new people. Wayne Oldenburg, an industrial manufacturer from Wisconsin, is an example. I bought two mares for him in 1999. This past November, I bought two more for him at Keeneland. One of them was Tap Your Heels, whom we got for $750,000. The other was Megan's Leprechaun. We got her for $550,000.
"The bloodstock markets are strong from the middle to the top, but weak from the middle to the bottom. We're creating more product than we can use. This has happened before-in the mid-1980s, we were producing 50,000 foals a year and ran out of people who wanted them. There was a record consignment at Keeneland this past November, but things really got dead the closing days of that sale. We've set some spectacular records in recent years, but I'm not sure where we go from here."
Bell has been active with the NTRA, specifically on a committee that is trying to improve communications between that organization and owners and breeders. "We point out the accomplishments of the NTRA, what goals were set forth in its business plan, and what has been implemented to achieve those goals," Bell said. "Working toward a common good isn't always easy. In this case, some pretty diverse people are involved, and some fundamental differences have to be worked out. But racing's overall image is improving. I'm very optimistic about the sport's future."
Bluegrass Thoroughbred Services
Principals: John Stewart and Peter Bance
Location: Lexington, Kentucky
Founded: 1980
Focus: Assists clients in purchasing, breeding, and selling racehorses
"We're not a huge outfit; we annually sell about 75 yearlings for clients, but we get results," said John Stewart. "Six horses we've consigned to sales won graded stakes this year. They include Lady at Peace, Shawnee Country, Gleefully, and two-year-old winner Fistfite. For the whole of 2000, our gross sales totaled over $8-million. We sold a $1-million Seeking the Gold filly at Keeneland in September for the estate of Paul Mellon. We also sold a Carson City colt for $900,000 at Saratoga in August for Prince (Fahd) Salman's Newgate Stud. Those are solid numbers."
Stewart and his Bluegrass Thoroughbred Services partner, Peter Bance, are originally from Virginia. Bance, who is also an executive with Marsh Insurance, remains based in Richmond, his hometown. Stewart operates from Lexington. "We like to think of ours as a boutique sales agency, dealing with better than average horses for special clients," Stewart said. "Our client base is primarily in the East, people from Virginia, Maryland, Pennsylvania, and New York.
"For many years, we've also been involved in raising money to purchase into stallions. We organized the sale of Lord Carson to Vinery and kept a 25% interest in the horse. It looks like he's going to be the second-leading freshman sire in 2000. We also helped with the syndication of Vicar earlier this year."
South America is another focus of Bluegrass Thoroughbred Services. "We've raced horses and have done some stallion deals down there," Stewart said. "Most importantly, we've been buying a lot of broodmares, primarily from Argentina. We personally own Esperada, who was the champion two-year-old filly in that country in (1999). She's going to (be bred to) Dubai Millennium. Only a few North American bloodstock agents specialize in Argentina, but it's the country whose racing most resembles that of the United States. To us, it's a logical place to be."
British Bloodstock Agency (England)
Principals: Joss Collins and David Minton
Location: Newmarket, England
Founded: 1911
Focus: Stallion shares and management; purchasing yearlings and broodmares
Every year is an active one for British Bloodstock Agency (England). At Keeneland last January, company director David Minton handled the bidding for Roger Baines's Britton House Stud, which purchased Mackie for $5-million. In foal to Mr. Prospector, Mackie fetched the highest price of any broodmare sold at a North American auction this year. At Keeneland in November, the company was involved in a trio of broodmare purchases by Britton House, each of whom brought six figures. Agents for BBA (England) further signed 34 other tickets at the November auction for total expenditures of $3,330,000.
BBA (England) currently lists agents and representatives in 41 countries on six continents, and it manages nearly three dozen stallions. The English tend to treasure enduring institutions, and as of next year BBA (England) will be just a decade short of a full century of existence. The company was around nearly three decades before Winston Churchill became prime minister, more than four decades before Queen Elizabeth II ascended the throne. No other major Thoroughbred bloodstock agency can claim such longevity.
Gone, though, are the days when BBA (England) spent $13.1-million for a yearling, which was the case with Seattle Dancer at the 1985 Keeneland July sale of selected yearlings. This remains the world-record price for a horse at public auction, but it is not a standard that company representatives are inclined to match, much less surpass. Practicality is the governing factor for BBA (England) today. If one is diligent, the right horses can be found for reasonable prices.
The essential strength of BBA (England) remains the breadth of services it offers, from foal and yearling purchases, to broodmare purchases, to stallion syndications, to consulting, and beyond. Scores of years of experience accompany everything the company does. That in itself has served as an attractive lure for clients-past, present, and future.
Hubert Guy
Principal: Hubert Guy
Location: Pasadena, California
Founded: 1983
Focus: Buying and selling horses in training; small amount of activity in yearling and broodmare markets
As a young man, Hubert Guy was an amateur steeplechase rider in his native France. He subsequently worked for a year in England and then moved to Southern California to exercise horses for Charlie Whittingham.
"I wanted the experience of seeing racing in the United States," Guy said. "I thought perhaps that I might become a trainer. Within two years, though, I was selling horses for various farms. Now, I spend much of my time purchasing horses in Europe and selling them here."
Most of Guy's transactions are done privately, and almost all involve horses in training. "That's my bread and butter," he said. "Right now, there's more of a buyer's market in Europe. I go there 12 to 14 times a year. I'm willing to travel a long distance to get the right horse. The prices in Europe haven't gotten as out of hand as they have in the U.S., but they may get that way. People want the best, and they're willing to pay big bucks."
Guy's client list includes, among others, David Milch (producer of "NYPD Blue"), Jed Cohen, Michael House, Jeff Dehven, and Art and Jack Preston. Horses sold by Guy include 1996 Breeders' Cup Sprint (G1) winner Lit de Justice, 1999 Breeders' Cup Mile (G1) winner Silic (Fr), Grade 1 winner Caffe Latte (Ire), and Suances, who was a Group 1 winner in France this year.
"The bloodstock markets remain strong at the top," Guy said, "but I see a gap growing between the middle and lower levels. Purse structures are a factor in effecting this. In states such as California, they're too low; they're not keeping up with the inflated prices of horses. This has the potential of creating some major problems in the future. Believe me, I see similarities between what's happening now and what happened in the mid-1980s."
Lavin Bloodstock
Principals: Allen and Kevin Lavin
Location: Goshen, Kentucky
Founded: 1990
Focus: Consulting for a long-standing group of clients; arranging breedings; selling yearlings at auction
"Lavin Bloodstock is something that evolved from Longfield Farm," said Allen Lavin, who operates the agency with his brother Kevin. "We were born into this industry. We're fourth-generation horsemen. My father, Dr. Avery Lavin, and my mother, Betsy, have been very influential in everything we've done. This is a family operation, and we think of our clients as family, too. My brother runs Lavin Insurance Services and Lavin Insurance Group. I run Longfield, which encompasses 750 acres. We sell under Longfield and buy under Lavin Bloodstock. The two are separate entities but very closely related.
"The biggest factor in what we do is consulting. We don't get involved much in private transactions, but we do of course have an auction presence on behalf of a number of people. We don't recruit clients. Most of the ones we have are old friends. They include Steve Dunker, Peter Willmott, Allan Dragone, Edward Evans, John Ed Anthony, Lee Lewis, and the Bonnie family's Kingfish Stable. Our services run from A to Z. We do everything relating to horses except training, and those to be trained we place.
"Truthfully, we weren't very active in buying horses this year. Prices have gotten very high. Our family breeds to sell and keeps a few to race. Ninety percent of our clients breed to race and sell occasionally. That's an unusual flip-flop. There are over 100 mares on the farm. But very few of them are auction mares. If we have a big year, we might sell 30 yearlings.
"There's too much product on the market. The market cannot absorb 4,600 horses cataloged at Keeneland in September and 5,100 cataloged in November. Then there are 2,400 at Newmarket, and the Keeneland January sale comes barely a month after that. These are global sales, yes, but that's a lot of horses."
John F. Moynihan Thoroughbred Services
Principal: John Moynihan
Location: Lexington, Kentucky
Founded: 1994
Focus: Purchases unproven racing and breeding stock for clients, privately and at public auction; provides full-service management of bloodstock; pinhooking
Buy low, sell high. It is the credo of any successful business, and it is the keystone of John F. Moynihan's operation. "We sold a two-year-old Saint Ballado colt for $2-million at Barretts this past March," Moynihan said. "He's the highest-priced juvenile auctioned publicly in 2000. I initially purchased him privately for $150,000 for Martin and Sharon Cherry.
"At Keeneland in November, Blissful, a full sister to Fusaichi Pegasus, sold for $4-million. I initially purchased her for $1-million for Bob and Beverly Lewis. Large profit margins are our goals."
Moynihan, a native of Frankfort, Kentucky, who graduated from Kentucky State University, has been in the Thoroughbred business since 1987. He spent four years with Fasig-Tipton's bloodstock division and then formed Walmac Bloodstock Services in partnership with John T. L. Jones Jr. The company that carries Moynihan's name was founded six years ago. The Cherrys and Lewises are among his select group of clients, as are Ed and Natalie Friendly.
"My clients formulate budgets as to what they want to spend each year, and then they turn me loose, allowing me to manage it the way I see best," Moynihan said. "Almost all of my purchases involve weanlings, yearlings, and two-year-olds. I purchased 1999 Horse of the Year Charismatic as a foal for $200,000. I purchased Exploit, the 1999 Kentucky Derby (G1) winter book favorite, as a foal for $525,000. Exploit is now standing at Taylor Made (Farm), and he's worth eight figures. I own a piece of him myself.
"I'm guardedly optimistic about what's going to happen in 2001. Our buying focus will be 100% on quality. In other words, we'll be purchasing fewer horses but paying more for them. We'll also concentrate on selling the quality stock we've accumulated the past several years. Right now, acquiring a good horse costs an awful lot of money. The current markets are much more palatable for sellers."
Narvick International
Principals: Emmanuel and Laura de Seroux
Location: Rancho Santa Fe, California
Founded: 1983
Focus: Advises and assists clients in the entire range of bloodstock purchases and consignments for racing and breeding; training of horses
"Things just keep on getting better," said Laura de Seroux, who with her husband, Emmanuel, own and operate Narvick International. "In 2000, we added consigning to our list of services. We handled the dispersal of (the late) Marshall Naify's racing stock at Barretts in July. The timing there was beautiful because it took place just before Del Mar's meet, allowing us to get top dollar. We also dispersed the Naify estate's broodmares and weanlings for $5.5-million at Keeneland on November 5. That same day, we handled the Allen Paulson living trust reduction, which brought $12.5-million."
Narvick serves clients in the United States, South America, Europe, Saudi Arabia, Australia, New Zealand, and Japan. "Sidney Port, who owns a very successful hardware-supply business in Chicago, has been a wonderful supporter for many years," Laura de Seroux said. "Sultan Al Kabir, who's a member of the ruling family of Saudi Arabia, has also been with us for a long time. Emmanuel's vision has always been global. He gets around."
The Narvick training operation, which she heads, is based at San Luis Rey Downs in Southern California. "Wayne Gretzky, the former hockey player, Mr. Port, Sultan Al Kabir, Dwight Kendall, and John Martin are our main partners in this," she said. "On opening day of Hollywood Park's fall meet, we sent out a wonderful Southern Halo mare, New Heaven (Arg), to win the Safely Kept Handicap. New Heaven is owned by Yoshi Ito from Japan.
"Continued strength in horse sales can particularly be found at the top of the markets, where the buyers have wealth that's been gained over a long period. They aren't nearly as affected by the fluctuations of the stock exchanges as others. The middle and lower levels of the sales are more tenuous, with participants more likely to fade in and out. I expect these trends will extend through next year."
Nicoma Bloodstock
Principal: P. Headley Bell
Location: Lexington, Kentucky
Founded: 1979
Focus: Consultant work for leading breeders throughout the world
P. Headley Bell's choice of a vocation was logical. A fourth-generation horseman, he is the son of Alice Chandler, grande dame of Mill Ridge Farm, and grandson of the legendary Hal Price Headley. Reynolds Bell Jr. is his brother.
"I grew up in this business, and my appreciation of it has never ceased," Bell said. "My clients include the Maktoums, Juddmonte Farms, Haras de Mezeray, Audrey Otto, and George Strawbridge Jr. I buy seasons for them, arrange matings for their broodmares, buy and sell yearlings. It's a pretty full range of services."
No Matter What, who Bell purchased for $425,000 at the 1998 Keeneland July yearling sale for Strawbridge, won the 2000 Del Mar Oaks (G1). In 1992, Bell paid $100,000 for the mare Existentialist, and her yearlings have since fetched more than $5-million at sales. Nicoma has assisted in the matings of two Prix de l'Arc de Triomphe (Fr-G1) winners, Suave Dancer and Trempolino. These are just a few items on a long list of accomplishments.
"I work mostly in the United States and Europe," Bell said. "The Europeans remain very active in the high end of the bloodstock markets. This was very evident at Keeneland this past November. Strong at the top, weak at the bottom-that's the consensus view of the markets. People who have the money are buying carefully to suit their programs.
"With prices the way they are, we all have to walk very cautiously. There are too many horses; their numbers exceed the numbers of buyers we have. Stud fees for top stallions are very high. What happens on Wall Street doesn't figure in very much. The Maktoums don't invest there. Neither does (Coolmore Stud principal) John Magnier. What does drive our industry are people who have been successful in business and want to compete in another arena. There's a lot of ego involved, a lot of thrill. Once you get a taste of our sport, it's hard to deny."
Mike Ryan Bloodstock
Principal: Mike Ryan
Location: Lexington, Kentucky
Founded: 1981
Focus: Purchases yearlings for a select core of clients; purchases weanlings and yearlings for pinhooking purposes
In the past six years, Mike Ryan has purchased 17 yearlings for Carl Pollard. Eight of them have been stakes winners, including Caressing, who scored an upset victory in this year's Breeders' Cup Juvenile Fillies (G1). "We paid $180,000 for her at Keeneland in September of 1999," Ryan said. "It was particularly rewarding to have been able to do that for Carl, who has been an associate ever since the late Warner Jones introduced us. I've also bought lots of good horses over the years for Allan Dragone, the retired chairman of the New York Racing Association, and Thomas T. Carey. One of the purchases I made for Mr. Carey was Senor Tomas, who won the 1992 Super Derby (G1) at Louisiana Downs."
Originally from County Meath, Ireland, Ryan migrated to Canada in 1974 and went to work at E. P. Taylor's Windfields Farm. In 1979, Ryan established his own agency in Canada and began a professional relationship with Robert Clay of Three Chimneys Farm near Midway, Kentucky. "Robert and his father (Albert) were very instrumental in getting me to come to the United States," Ryan said. "I've purchased a lot of good mares for Robert over the years, including Kamar, who was the dam of Gorgeous.
"I have a syndicate where we buy weanlings each year to resell as yearlings. And then I have another syndicate where we buy yearlings and resell them as two-year-olds. We've had a lot of success."
As agent, Ryan purchased Yonaguska, bred by Edward P. Evans, for $145,000 at the 1999 Keeneland September yearling sale. The Cherokee Run colt was pinhooked into the 2000 Fasig-Tipton Co. Calder sale of two-year-olds in training, where he sold for $1,950,000 to Demi O'Byrne. Racing for Michael Tabor, Yonaguska won the Flash Stakes and then dead-heated with City Zip for first in the Hopeful Stakes (G1).
"It's important, of course, for our investors to make money," Ryan said. "But it's equally important for the horses we sell to do well at racing. People go to the sales searching for winners. We certainly need every new owner who comes into this industry. Right now, we don't have enough of them."
Thoroughbreds International
Principals: Walid Bohsali and Glenna R. Salyer, D.V.M.
Location: Lexington, Kentucky
Founded: 1982
Focus: Arranging breedings and brokering stallion seasons and shares; providing equine insurance; purchases yearlings and mares privately and publicly
"The number of deals we did in 2000 did not increase dramatically from the year before," said Glenna Salyer, D.V.M., who with Walid Bohsali owns and operates Thoroughbreds International. "What did go up, in many cases, were the amounts of money involved. In a 12-month period, the value of an A.P. Indy share went from $1.6-million to $3.2-million. The value of a Kingmambo share went from about $800,000 to $1.8-million. They're young stallions, but we see this with some of the older stallions, too, such as Dixieland Band, Gulch, and Dynaformer."
Thoroughbreds International owns shares or portions of shares in 45 stallions. Among them are those named above, along with Affirmed, Broad Brush, Gilded Time, Green Dancer, Gone West, Marquetry, Out of Place, With Approval, and Woodman. The mix changes somewhat with each year.
"We have lots of good, loyal clients, both in the United States and overseas," said Salyer. "The biggest buyers at the sales still tend to be foreigners. We're quite dependent on them. I was flabbergasted to see the intense activity by the Irish, French, and other Europeans at Keeneland this past November, considering how strong the U.S. dollar has been against the punt, franc, and other European currencies.
"People keep saying, 'Oh, gee, the horse markets are doing so great,' but that's not 100% true. It's actually a polarized, feast-and-famine situation. What's hot is very hot, much in demand, hard to get, and goes for premium prices. This is true for yearlings, mares, stallion seasons or shares, just about everything. Either everybody wants it, or nobody wants it. Go to the horse sales, observe carefully, and you'll see exactly what I mean. It's a scary, scary situation right now."
(Tyson Gilpin)Stallion Service Bureau
Principal: Patrick Lawley-Wakelin
Location: Boyce, Virginia
Founded: 1961
Focus: Provides wide range of management services for clients; purchases stallion seasons and shares; plans matings for broodmares
"Personally, for us, it has been a tremendously trying year," said Patrick Lawley-Wakelin, who currently heads the late Tyson Gilpin's Stallion Service Bureau. "Mr. Gilpin passed away on May 7. And our primary client, Ernest Samuel (owner of Canada's Sam-Son Farm), died on May 25. Tyson was both a father figure and mentor, and Mr. Samuel was a great sportsman and family man, loved by everyone. Look what happened in the months immediately following his death. Sam-Son won the Canadian Oaks with Catch the Ring, the Queen's Plate (Stakes) with Scatter the Gold, and was second in the Breeders' Cup Turf (G1) with Quiet Resolve. Amazing!"
The Stallion Service was one of the first agencies in the East to deal in stallion shares and seasons. Lawley-Wakelin, originally from England's Stratford-on-Avon area, was given a desk at the agency in 1993. "During the past ten years, Tyson's interest shifted into other areas, including consigning horses to sales and suggesting matings for clients' mares," he said. "But we've remained very busy in recent times purchasing shares in stallions such as Unbridled, Gone West, and Kingmambo for Sam-Son.
"I continue to work closely with Sam-Son's trainer, Mark Frostad. Mr. Samuel's widow, Elizabeth, has assumed the operation's reins. Her daughter, Tammy Samuel-Balaz, is Sam-Son's general manager. We've just completed a big transaction for them, selling Scatter the Gold to Japan's Shizunai Stallion Station. We did the deal through Narvick International. Sam-Son has a crack two-year-old filly, Dancethruthedawn, who's one of the best in her division in Canada. (Full siblings Scatter the Gold and Dancethruthedawn are by Mr. Prospector and out of Sam-Son's champion Dance Smartly.) I'm immensely proud to be on their team.
"For estate-closure purposes, we're in the process of putting the wraps on the Gilpin company. It's heartbreaking, but a necessary thing to do it. And we've formed a new company, Lawley-Wakelin Bloodstocking. Our goal is to carry on in Tyson's tradition."
