Divesting racing king Barry Irwin says “power freaks” causing his SA exit
For most South Africans, horseracing is very much on the fringe. In its rare appearances on the public agenda, the sport is dismissed as a harmless distraction for inveterates.
Long gone are days of packed racecourses; a weekly Jackpot consortium; or even annual office sweepstakes on the Durban July. A sad reflection of a business model that never recovered after its gambling monopoly ended.
Despite a decline to a level where only 8c in every gambling rand is for the gee-gees, those who fund the entertainment – racehorse owners – have kept digging deep. The obvious question is: Why? The Oppenheimer, Rupert, Jacobs and Plattner families didn’t make and keep fabulous fortunes through stupid bets.
Yet in recent years these otherwise sensible investors, together with more recent additions like industrialist Markus Jooste (Steinhoff) and banker Bernard Kantor (Investec), have been doubling down. What do they know that the rest of us don’t?
Until the past week I thought I had a good idea. Now I’m not so sure.
The obvious argument is that by global standards, South African bloodstock is dirt cheap. Antiquated protocols that have blocked local horse exports are about to change. Common sense suggest that will lead to a massive re-rating of values. And provide the foundation for a sustainable future business. It costs a fraction of the international average to raise a thoroughbred here.
Cheap to produce, perhaps, but world class in quality. Innovative trainer Mike de Kock’s SA-bred stock have taken on and beaten the best in the world in Dubai. Add in huge pent-up demand from Asia, especially horse-mad China and neighbor Mongolia, and this looks to be a market poised to explode.
This convincing story also received the necessary global heft through the support of the world’s biggest racehorse syndication operation, Team Valor. CEO and co-founder Barry Irwin has been a vocal fan having enjoyed considerable success campaigning cheaply bought SA-breds internationally, winning some of the world’s top races.
Based in the heart of US thoroughbred country, Irwin rarely missed an opportunity to extol the virtues of the SA thoroughbred. Whether that be to Team Valor syndicate investors or, indeed, anyone else who would listen. And horse people do listen, attentively, when Irwin speaks. As you would expect from a man whose horses have won most major prizes in US racing, including the Kentucky Derby (in 2011).
But this week Irwin changed his mind. Radically. SA’s best foreign friend, it seems, has now become a foe.
In a confidential letter to his South African clients, now in the public domain, Irwin says racing in the country has “ceased to be fun….in a place where the health and well-being of our horses can no longer be taken for granted.” Serious as that sounds, it’s only a side issue.
Irwin’s displeasure is primarily with “control freaks that prevent racing from growing…” And the thinly veiled focus of his ire is furniture mogul Jooste, easily SA’s biggest racehorse owner and, together with his partners, propriettor of the largest breeding farm, Klawervlei. Jooste, who has poured hundreds of millions into the sport since fluking a Champion in the first horse he owned (National Emblem) is also the force behind the new competitor to the sales arm of the industry’s Thoroughbred Breeders Association. The entry of which has caused considerable distress in an already stretched sector.
Irwin has ended fresh investment in SA and says he came close to cutting completely and dumping his existing assets. After some reflection, though, he decided to hold onto some breeding stock including his promising young stallion Visionaire.
In the confidential letter he says: “A small coterie of powerful and wealthy owner/breeders has placed a stranglehold on the game as it seeks to exercise complete control over all of racing in SA, which is not a healthy situation as the participants have repeatedly demonstrated that they have little use for expanding or improving the sport of racing for the widest range of participants. They give whole new meaning to the phrase ‘Old Boys Club’.”
Irwin’s letter was leaked to and posted on Africanbettingclan.com, the country’s active online horseracing forum. When I contacted him, Irwin was upset his confidential missive was in the public domain. But says he stands by everything he wrote. (click here for my questions and his full response)
Who is this coterie, I asked? Is your beef with Markus Jooste and Klawervlei?
Irwin responded with: “It does not take a clued-in individual to name the people I referenced. “
OK. So I asked for comment from Jooste’s racing manager Derek Brugman (click here for the correspondence) He was innocence personified: “I have no idea who Barry is referring to and would be quite surprised if he is referring to my clients as he breeds in partnership with us.”
Irwin wouldn’t see the joke. Clearly, he is now looking for support from the non-Jooste camp, adding in his note to me: “There are enough other participants at a high level that, if they had the will, could wrest power and make a big difference in improving racing in South Africa. All it takes is the will.”
“These other fine folks,” Irwin continues, “have the money, the experience, the savvy and the ethics to make a change. So far they have lacked the will in sufficient numbers…..Four guys sitting around a single table running things for everybody is a bad formula for success.”
Brugman, who with Jooste, Kantor and former industrialist Chris van Niekerk is presumably one of the “four guys” couldn’t resist a riposte of his own. There were several inaccuracies and contradictions in Irwin’s letter, he says: “But I have no interest in debating them with Barry and/or defending any particular viewpoint. Barry is a commercial person and he must do what he believes is best for himself. My money says the day our export protocols open up, Barry will be one of the most active participants in our market!”
