NEWS
Industry Leaders: Bloodstock Agents
Posted: Saturday, December 08, 2001
Leading bloodstock agents consider the economy and factors unique to the Thoroughbred industry
An underproduction of quality coupled with an overproduction of mediocrity: Of all the circumstances that have adversely affected North America's Thoroughbred sales this year, these, according to the leading bloodstock agents, have had the greatest impacts.
Of course, there were other factors, as well. As of November 27, the Dow Jones Industrial Average was down 8.3% for the year, the NASDAQ was down 21.4%. Some companies have consolidated their activities, laying off thousands of employees in the process. And, then, there was September 11.
Within the Thoroughbred industry, there was the devastating and ongoing toll taken by mare reproductive loss syndrome (MRLS). It has affected both the number of horses consigned to this year's Keeneland November breeding stock sale and the prices they drew. Keeneland's upcoming January horses of all ages sale will have a similarly reduced catalog, and its yearling auctions in 2002 and '03 will most likely be severely impacted. "There is a light at the end of the tunnel," said bloodstock agent Rollin W. Baugh, "but, right now, it's somewhat dimly lit."
Yet, as always, optimism-albeit that of a cautious variety-continues to be the prevailing attitude among bloodstock agents. "We wouldn't be in this business if we didn't wholly believe in it," said Baden C. "Buzz" Chace. "We're involved in a grand sport, backed by hundreds of years of wonderful heritage. Our country's solid. So, too, is America's Thoroughbred industry."
As is the custom at this time each year, Thoroughbred Times has profiled 12 bloodstock agents and agencies whose North American activities have been prominent during the past 12 months. Some cater to a large international clientele. Others deal on a smaller, distinctly domestic level. All speak articulately about the industry they are in and have been afforded the opportunity to voice their opinions, concerns, and belief in the future.
The following profiles were written by Bill Mooney, a contributing editor for Thoroughbred Times.
Rollin W. Baugh
"When I was a boy, I lived a little less than a mile west of Santa Anita Park," said Rollin W. Baugh. "The area around our home was called Chapman Woods, which was developed by Jim Stewart, who later became the general manager of Hollywood Park. So, you might say I was surrounded by the lure of horse racing. I still am.
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
"One of my personal highlights for 2001 was selling Captain Steve to the Japan Racing Association, which in turn donated him to the Japan Bloodstock Breeders' Association. It was great to be a participant in that transaction."
One of Baugh's long-lasting clients is his close friend Gary Biszantz, who is currently setting up a major breeding operation at his Cobra Farm in Lexington.
"It involves 330 acres," Baugh said. "It's part of my job to advise him on all general matters involving his breeding and racing activities, although Gary has a number of other people around him, too-trainers, farm managers, a racing manager. I'm very pleased at how well Old Trieste is doing for Gary at stud. Old Trieste's weanlings are being very well accepted.
"The declines in gross receipts that we saw in the bloodstock markets this year do not entirely defy explanation," said Baugh. "The overall United States economy was down this year. We had the terrorist disasters to deal with and the effects of mare reproductive loss syndrome on the major Kentucky farms. If these things hadn't happened and the bloodstock prices had gone down as much anyway, then our industry would be looking apprehensively over its shoulder. But that's not the case.
"Overall, racing's doing okay. Phone wagering's expanding, and I see TVG's role in that as a big positive. International racing continues to expand, and the increasing availability of such global events on worldwide television points to a huge plus.
"We have to capture that nitwit hiding in his cave in Afghanistan. And the (United States) economy must be put back on an even keel. Once those things happen, I think we're going to be fine."
Reynolds Bell
"It has been a tough year for our country and, in many respects, for the Thoroughbred business, too," said Reynolds Bell Jr. "A declining world economy has had an effect on us, our own stock markets have gone down, and we were hit with mare reproductive loss syndrome. I'll tell you, though, I think we've held up pretty well over the course of the year. Keeneland's July yearling sale was okay, Saratoga's sale in August was solid. The Keeneland September sale was incredibly strong, despite the horrific national tragedy that took place on September 11.
Reynolds Bell Thoroughbred Services
Principal: Reynolds Bell Jr.
Location: Lexington
Founded: 1992
Focus: Advises and serves as agent for clients in private sales and at public auctions; stallion seasons and shares; stallion management
"What our markets do lack is depth," Bell said. "They're very competitive at the top levels, weak at the bottom. I think some of the overproduction of horses in recent years has begun to catch up with us. The laws of economics say that this problem will take care of itself. It always does. If the demand's not there in certain segments, people will eventually make the necessary adjustments."
Bell, 49, comes from a lineage of horsemen and women that includes his grandfather, Hal Price Headley, his mother, Alice Chandler, and his brother and fellow bloodstock agent, P. Headley Bell.
"For me, the highlight of 2001 was the success that Richard Santulli and George Prussin had with their Jayeff B Stables," Bell said. "I bought a yearling filly for $1.3-million for them at the Keeneland July sale in 1999 named Cat Chat. She's by Storm Cat out of Phone Chatter, who was North America's champion two-year-old filly in 1993. Cat Chat won her first three career starts, including the Nassau County Stakes (G2) at Belmont Park last May, before getting hurt. She will be back racing next year, I believe, and her breeding future looks excellent. I also bought Navesink for Jayeff B as a yearling. He won a pair of graded stakes this year.
"Of course, Not everything works out perfectly. I do a lot of work for the Maktoum/Darley group, and it was really hard when their stallion Dubai Millennium died last spring. This business hits you with some blows. The weak falter, the strong recover."
Blandford Bloodstock
For three decades, Joss Collins was a primary representative of British Bloodstock Agency (England) at North American sales. This past summer, he and fellow BBA official Tom Goff left that company to set up their own agency, Blandford Bloodstock, which they co-direct. "Every horse BBA (England) successfully bid for at Keeneland in July was knocked down by Josh, but it was Blandford we represented at Saratoga in August and Keeneland in September," Goff said. "Yes, we jumped from one thing right into the other rather quickly.
Blandford Bloodstock
Principals: Joss Collins and Tom Goff
Location: Newmarket, England
Founded: 2001
Focus: Stallion shares and management; purchasing yearlings and broodmares
"Our goal is to provide a professional service, with a personal touch," said Goff. "Most of our clients have been with Joss for quite a long time, and they decided to stick with us. Right now, we're concerned with simply getting to the end of this year, at which point we will take a good look at ourselves."
"Leaving BBA (England) wasn't a decision I made lightly, a sudden inspiration at the end of the day," Collins said. "I'm fortunate that so many clients have been loyal and stayed with me. Blandford will have dealings in South Africa, Turkey, Greece, England, Ireland, France, and Australia-quite a variety of countries, really. I'd love to do something for the Maktoums, but they have their own team, so they don't need me.
"You can't allow yourself to get too big too fast, though," said Collins. "You're much better off at the end of the day if you've tended to a smaller number of people well rather than a larger number poorly. You don't want to try to be something to everyone and end up being nothing to no one. If the latter's the case, you'll end up constantly trying to find new clients.
"North America's bloodstock markets, right now, are the same as they are worldwide. It's either feast or famine. Good horses sell well. The ones that don't match up, well, there's very little interest in them. Too many horses are being produced, but things will settle down. In the end, people will breed less mares, produce less foals, and the situation will rectify itself."
Bloodstock Business Agency (Ire)
"There no longer is a British Bloodstock Agency (Ireland)," said Adrian Nichol. "Last May, we bought the company out, although you can see we kept the initials. It's no longer a publicly held company; there are no longer any outside shareholders. The people who work at Bloodstock Business Agency (Ireland) own it. I'm chairman of the board, and Patrick Cooper is director. The former company dated back to 1962, and I had been with them since 1970. As always, we have a large clientele from here and 'Down Under.' Many have been with us for decades.
Bloodstock Business Agency (Ireland)
Principals: Adrian Nichol and Patrick Cooper
Location: Kill, County Kildare, Ireland
Founded: 2001
Focus: Purchases potential racehorses and breeding stock for clients largely situated in England and Australia
"We do a lot of work for Robert Sangster. We purchased quite a few yearlings for him this year. In general, mare-wise, foal-wise, and definitely yearling-wise, our English clients were very active in 2001. This isn't surprising, for quality always sells. The world economy is having its ups and downs, but there's still plenty of competition when purchasing a good horse. I missed out on several fine mares at Keeneland this past November, simply because I did not have enough money.
"Problems within the bloodstock markets, in my mind, stem from overproduction," said Nichol. "This is true in North America, and it's true at the European sales as well. Buyers have become extremely selective. We enjoyed a huge boom time during the past three years or so, and some people began breeding lots of ordinary horses. I think they're realizing the folly of that now."
One of Nichol's duties is to purchase yearlings for the Hong Kong Jockey Club, which in turn sells them when they reach age two at its annual sale in December. "That sale takes place during Hong Kong International Races week, and it's something to see," Nichol said. "The European consignment for that sale has gone up enormously this year.
"The mare reproductive loss situation in Central Kentucky has been a desperate thing, and the shortage of foals will be noteworthy during the next two years. Many buyers who go to the American sales will come home empty-handed.
But the top will hold up. It always has, and I expect it will in the future."
Baden P. "Buzz" Chace
"Highlights, oh, we've had plenty of them in 2001," said Baden P. "Buzz" Chace. "Richly Blended won the Gotham (G3) and Withers (G3) Stakes in New York.
Griffinite won the Lafayette Stakes (G3) at Keeneland. Songandaprayer won the Fountain of Youth Stakes (G1) at Gulfstream Park. I was the guy who purchased all of those horses for their owners. I bought Unbridled's Song and Artax too, for prices which wouldn't do the trick nowadays. Unbridled's Song had two Grade 1 winners in his first crop. Hey, you should be proud of something like that."
Baden P. "Buzz" Chace
Principal: Buzz Chace
Location: Little Silver, New Jersey
Founded: 1983
Focus: Purchases horses for various clients for racing and breeding
purposes
Chace purchased a filly named Al Max Diner, who won the Holly Stakes at the Meadowlands this year. "I got her for Raymond Dweck, and he allowed me to name her for an eatery in my hometown of Fall River, Massachusetts," Chace said.
"When I was a kid, I used to got to Narragansett Park and Lincoln Downs, and Rockingham Park and Suffolk Downs, and all the Massachusetts fairs-Brockton, Weymouth, Northampton. Not many bloodstock agents come out of Fall River, I guess, but I did.
"The bloodstock markets have gotten spotty, but when really good horses are brought into the sale ring, you still have to pay fairly substantial prices for them," said Chace. "Buying horses always involves seeking value. My clients also include Ernie Paragallo, Charles Hesse, Aaron and Marie Jones, and Roger King of King World Productions. King owns Oprah Winfrey's television show. There are so many of them, and they're all great people.
"I like to think I've got a good eye for a horse. I'm the only bloodstock agent I know of who predicted that Valid Expectations would be the leading freshman sire this year. This is a game of chances, but if you do your homework and prepare properly, you can beat the odds.
"Horses have always been part of my life. I grew up riding Morgan horses and participating in shows. I'm 59 now, and I'm helping others bring horses into their lives. That's a pretty enjoyable way to make a living."
Dapple Bloodstock
"We founded our company in the mid-1980s when the yearling market, especially, was really hot," said Mike Akers, president and owner of Dapple Bloodstock. "When things took a tumble in the late portion of that decade, we were fortunate enough to have clients who allowed us to weather the storm. We didn't have to start a farm, or something like that, for cover.
Dapple Bloodstock
Principal: Mike Akers
Location: Lexington
Founded: 1985
Focus: Management of broodmare portfolios and syndication of racing stock
"Truthfully, we did not evolve from any great plan," said Akers, 48.
"Dapple's a bloodstock agency that's gone through lots of trial and error, and now we work both the production side and the entertainment side. We've long been involved in the buying and selling of breeding and potential racing stock. Now, we've gotten interested in racing ourselves."
What does Dapple look for in the various Thoroughbred markets? "Anything undervalued," Akers said. "That's what a good agent does. We've always looked for the young horse we could turn around at a future sale. We have a half-dozen strong clients for whom we provide broodmare management services. This involves mare selection, annual culling and replacing, mating and production of the product, and selling that product as well. Over the years, some of our clients have expressed a desire to compete at the track, so three years ago we began syndicating about a half-dozen horses per season, to run just for fun."
The racehorse syndication concept is important to Akers, "because it allows us to buy horses who are pretty well-bred, with the financial risk shared by a number of people, so it doesn't just fall on the shoulders of one client," he said. "Syndication also allows us to bring new people into the industry. That's always a goal. And if we can make the numbers work, they'll stay in the game.
"So many of our clients lead with their hearts," said Akers. "We try to put enough of a business outlook on the situation to keep their participation working for them from a cash flow standpoint. But people want to have fun, too, and that's what Dapple Stable's about. Racing's the carrot that feeds the business."
Darby Dan Bloodstock
The name Darby Dan dates back to 1934, when John Galbreath founded the farm bearing that name near Columbus, Ohio. "The (Lexington-based) bloodstock agency dates back 45 years, about the same time when Mr. Galbreath purchased the core of what had been E. R. Bradley's Idle Hour Stock Farm," said John Phillips, Darby Dan's managing partner. "The farm now has divisions-sales, stallions, boarding, and bloodstock. Tim McMurry is in charge of the bloodstock division, which is actually a quasi-independent operation. Tim captains the bloodstock ship."
McMurry, 47, is originally from Washington, "but that was a long time ago," he said. "Darby Dan Bloodstock, today, is largely an outside business that I developed myself and brought to the company seven years ago. I primarily buy yearlings and a few two-year-olds. One of my major duties is to help manage stallions, here and at other farms. From now until February, I'm pretty much locked to my desk making sure they're booked to sufficient numbers of outside mares.
Darby Dan Bloodstock
Principals: Tim McMurry and John Phillips
Location: Lexington
Founded: 1956
Focus: Purchase of yearling fillies to race and become broodmares; management of broodmare bands
"At yearling sales, I look more for fillies than I do for colts; I think the ratio's about five to one," said McMurry. "The idea is for the fillies to have successful racing careers, and after that I'll manage their breeding careers. I have about five major clients but most prefer their privacy, so I'm reluctant to release their names.
"Everything our industry does is tied to the overall U.S. economy. Interest rates are very low, nobody's making any money in the stock markets, money's gotten somewhat tight. There's been a real slowdown in the sale of stallion seasons, and I think one of the things we're going to see this winter is that a lot of inexpensive regional mares are going to stay at home.
"People always tell me, 'Find mares that have good value,' but, believe me, there's tremendous competition for them. Many people who went to Keeneland with aspirations this past November came home empty-handed. They only deal in quality, and if there isn't enough of it, they won't participate."
Charles Gordon-Watson
Natty in appearance and confident in his walk, Charles Gordon-Watson has a quick answer as to how long he has been in the Thoroughbred business. "All my life," he said. "My parents were breeders. I grew up around breeding and racing stock and founded my own bloodstock agency about 15 years ago. Our clients include Jabar Abdullah, for whom we purchased this year's leading two-year-old filly in Europe, Queen's Logic. We got her as a yearling in Deauville for a million francs, which is about $140,000. A solid investment, I'd say.
Charles Gordon-Watson
Principal: Charley Gordon-Watson
Location: London
Founded: 1986
Focus: Purchases yearlings for a select group of clients in Africa, Asia, and Europe
"Jabar Abdullah is an associate of Gainsborough Stud, and we do a lot of work for those people," said Gordon-Watson, whose apprenticeship in the bloodstock world also involved some major wheelers and dealers. "I was an assistant to Fulke Johnson Howard from 1979 to '83, when he was training for the Aga Khan. Then I went to work for Robert Sangster. I wanted to be my own boss, though, so eventually I started my own company."
During the ensuing 15 years, Gordon-Watson's clients included Brian Bell, Paul Cole, Edward St. George's Lucayan Stud, David Loder, and Andrew Lloyd Webber. "Perfect horses are hard to come by," Gordon-Watson said, "and even when one is found, rare is the agent who has unlimited funds to spend. There are pedigrees to consider; faults to consider; potential values, both in racing and breeding. You take all these things into account, establish a medium, then plot your course. It's a lot of work, and a lot of fun.
"We actually haven't been all that active at the North American sales in recent times. Rather, we've concentrated more on the European yearling markets. The major sales at Keeneland come a bit early-in Europe, they don't really start until the end of September.
"The foal losses experienced by Kentucky this past spring will injure the American yearling markets during the next two years, but not to a point they can't recover," Gordon-Watson said. "I'm upbeat about the future. I always am."
Horse France
"Our company was founded 28 years ago by my father, Roger," said Robert Nataf, the 55-year-old chairman of the board of Horse France. "Our headquarters are in Paris, but we also have offices in Dublin, Ireland, and Floral Park, New York. Our activities primarily involve bloodstock and shipping. Our Ireland operation handles all the major shipping for Aidan O'Brien's activities for Ballydoyle. That means all the European races and all the horses that ran in this year's Breeders' Cup, including Johannesburg, who won the juvenile event.
Horse France
Principal: Robert Nataf
Location: Paris
Founded: 1973
Focus: Purchase and transportation of both racing and breeding stock, primarily for European clients; pinhooking
"About 90% of our clients are situated in countries other than France," Nataf said. "In the bloodstock area, we consider ourselves to be brokers. Besides Ballydoyle, Horse France works a lot with the Irish connections of Coolmore. We represent the interests of both John Magnier and Michael Tabor in France. And, at home, we are very busy for Marc de Chambure. We purchase horses for clients, and occasionally I buy horses for myself to pinhook-weanlings to yearlings, fillies out of training to mares and foals, a mare in foal for the purposes of selling the foal later.
"Before terrorists began running planes into buildings, there already had been a slowing within the North American bloodstock markets. But that wasn't as great as the overall slowing of the American economy. I was a bit amazed by this. Usually when the stock markets decline, bloodstock prices decline even more dramatically. That was not happening. Major investors still had money for horses, and they were still inclined to spend it.
"September 11 changed things, but there are other factors," Nataf said. "If you look at Keeneland's November catalog, you'll see that there were a thousand less horses than last year, and their overall quality was considerably lower, too. Confidence was lacking. Still, the result wasn't catastrophic. Good horses continued to lure lots of money.
"We wanted to buy more horses than we did this year, but we couldn't always find what we were looking for. I'm not worried. We're due for one or two moderate years, then things will improve."
Narvick International
"Our consignments in 2001 were not as large as they were last year, but there is a reason for that," said Emmanuel de Seroux, who with his wife, Laura, owns Narvick International. "In 2000, we conducted the Marshall Naify/505 dispersal, along with the Allen Paulson living trust reduction. This year, we handled nothing along those lines. Still, I would have to say our bloodstock business continues to prosper. And our training operation, which is headed by Laura and based here in Southern California at San Luis Rey Downs, has done very well."
Narvick's clientele can be found on every continent, with the exception of Antarctica. "They neither have racing nor breeding there," noted de Seroux, with a touch of detached amusement. "We continue to do a great deal of work for the Allen Paulson family trust and for the Japan Bloodstock Breeders' Association.
Narvick International
Principals: Emmanuel and Laura de Seroux
Location: Rancho Santa Fe, California
Founded: 1983
Focus: Advises and assists an international range of clients in the entire range of bloodstock purchases and consignments for breeding and racing; training of racehorses
"Until Sundown, who Laura trains, won this year's Affirmed Handicap (G3) at Hollywood Park," de Seroux said. "He also was second in Hollywood's Swap Stakes, which is a Grade 1, so we were very pleased with that. Until Sundown is owned by a partnership of our clients. We have lots of young horses in training, so I anticipate that in the stretch from 2002 through '04 our racing profile will increase.
"To me, middle portions of the markets seem to be where the most difficulties are. There is a lack of buyers for these horses, and I think the major reason is that very few new people are coming into the game. I look around at the sales, and I don't see many unfamiliar faces. Those who are purchasing horses are not seeking large numbers of them. They are being very selective.
"In 2002, I expect that conditions will continue to be difficult in the bloodstock markets," de Seroux said. "People already in the business will continue to purchase horses, but I don't expect newcomers. We are living in a very cautious country right now, and I don't see that changing soon."
Nicoma Bloodstock
"I judge success by how well my clients do," said P. Headley Bell. "They are the people I serve, and they've been very loyal to me. One of the statistics I'm most proud of is my company ranked second, trailing only Demi O'Byrne, in the percentage of yearlings purchased between 1994 and '98 who became graded stakes winners. Our ratio was 18%. And, while Demi averaged something like $500,000 per yearling purchase, we averaged about $100,000. Consistently finding value for our clients is one of our most important goals."
Nicoma Bloodstock
Principal: P. Headley Bell
Location: Lexington, Kentucky
Founded: 1979
Focus: Consultant work for leading breeders and owners in North America, Europe, and Africa
The son of Mill Ridge Farm owner Alice Chandler and the grandson of Hal Price Headley, P. Headley Bell (along with his brother, Reynolds Bell Jr.) represents the fifth generation of horsemen within his family. "My mother has always credited my grandfather with being her guiding light, and over the decades she has filled the same role for me," Bell said. "I'm 47 years old now, but I'm still learning about the business from her. I hope that never ends.
"But it's the clients who really make our business a success," said Bell. "We work with Darley Stud, Gainsborough Stud, and Juddmonte Farms. George Strawbridge Jr. is with us, as are Roy and Gretchen Jackson. Like George, they're from Pennsylvania. Audrey Otto, who with my mother co-owned Keeper Hill, has been with us for a long time, as has Charles de Moussac from France, and Lazy Lane Farm. We're blessed to have all these people.
"Bloodstock markets have continued to be selective in 2001. Now is not the most apt time to be shedding mares from your broodmare band. Most of our clients don't rely on the Thoroughbred industry for their livelihood. For them, horses are more their passion. We're in challenging times for our country, and I think people are welcoming the distractions breeding and racing bring.
"Remember, nobody has to own racehorses. People do it because of the thrills and pleasure the sport provides, which are things that will always inspire the human spirit."
Mike Ryan Bloodstock
"Of the horses we've purchased, 15 of them were stakes winners this year," said Mike Ryan. "Oh, certainly, I take a great deal of pride in that. One of the highlights of recent times involves a trio of yearlings we purchased at Keeneland in September of 1999-Caressing, Yonaguska, and Kurofune. All three of them have become either Grade 1 or Group 1 winners.
Mike Ryan Bloodstock
Principal: Mike Ryan
Location: Lexington
Founded: 1981
Focus: Purchases yearlings for a select core of clients; purchases weanlings and yearlings for pinhooking purposes
"I bought Twenty Eight Carat as a yearling; she's the dam of A P Valentine. I bought Bright Feather as a maiden; she became the dam of Albert the Great. These things look very good on one's record."
Ryan, 47, is originally from County Meath, Ireland. In 1974, he migrated to Canada and secured a job at E. P. Taylor's Windfields Farm. Taylor set up his first bloodstock enterprise in 1979, and the Lexington-based agency that bears his name has been in operation for two decades. "I don't have a big clientele; it's small and select," Ryan said. "Carl Pollard, Tom Carey-they've been with me a long time. I've got a new client from New York this year named Randy Hill. I'm always trying to cultivate new ones. Our business desperately needs them.
"One of the things we've learned this year is that our bloodstock activities are not immune from the infirmities of the global economy. We, as a nation, are in tough times, but we'll survive, just as we always have in previous wars.
"Taking things into perspective, the American stock markets have actually held up pretty well. Corporations are downsizing their work forces. But most people have kept their jobs. People have money. For the time being, they're very careful about how they spend it. That's not bad.
"It's amazing how racing keeps going," Ryan said." There remains plenty of purse money up for grabs. Stakes continue to be run every weekend, year-round, from one coast to the other. We might not have the depth of activity in the sale pavilions that we'd like, but that will improve as things become more stable."
