BizNews webinar: Back at the starting blocks – can SA’s horse-racing sector be revived?

Like so many businesses and industries, South Africa’s horse-racing sector is in deep trouble.

As a result of  the devastating effects of Covid-19 and lockdown, Phumelela Gaming and Leisure filed for business rescue in May. The 54-page document was released on Wednesday.

According to its website, Phumelela contributes some R800m to the economy each year and the horse-racing industry creates direct and indirect employment for tens of thousands of people. Annual betting turnover on the sport is over R7bn.

According to the National Horse Racing Authority (NHRA), about 80% of the industry’s jobs were at risk as a direct result of the national shutdown. Also, most members of staff were furloughed.

In a BizNews interview in May, Racing Association directors Mike de Kock and Charles Savage discussed the effects of Covid on the industry.

At the time, Phumelela had received a generous lifeline of R100m from Mary Oppenheimer Daughters in an effort to ensure its survival post-lockdown.

“The R100m is really to make sure that the business rescue practitioner has got the capital to ensure that horse racing can survive for another six months. And that’s typically sufficient time for a business rescue practitioner to do a deal in business rescue to see the business survive again. And as Mike said, Mary’s commitment really was to save jobs. When you want to save jobs your conditions are less draconian than what they might have been if there was another capital provider.”

When asked whether the industry had reached rock bottom, Charles had this to say.

“There’s no doubt – this is as close as you’ll ever get to never coming back and I don’t think the racing industry fully understands that. You can’t go lower than this, because lower than this would be shut down. And I think this is a crisis that we can use to restructure and reform and build a trusted industry, and it’s a great opportunity for horse racing to redefine its future and that’s not going to be easy, but it is much easier now than it would have been five years ago.”

In our BizNews noon webinar (Thursday 20 August), Racing Association director Charles Savage and chairman Brian Riley join Alec Hogg to discuss possible ways to save the horse-racing sector.

*You can sign up for this free-to-attend webinar here: https://attendee.gotowebinar.com/register/7823246642506682640 

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