Million-dollar dreams as magic, madness take hold
The desire to own a winner on the track will get in your blood, with it easy to get caught up in the magic and madness of this epic event, writes Nathan Exelby.
CM Insight
Don't miss out on the headlines from CM Insight. Followed categories will be added to My News.
ACTION began in typically frantic fashion at the opening session of yesterday’s Magic Millions Gold Coast Yearling Sale, with attendees from all over the world hoping to secure the next big thing of the equine world.
This is the sale where Australia’s $22 million girl Winx was secured in 2014. It’s also the source of the $15 million earning sprinter Redzel, Melbourne Cup winners, Golden Slipper heroes and all the big race winners in between.
The success of Magic Millions graduates has led to it being one of the biggest bloodstock sales in the world.
Within the first hour, two horses had sold for $1 million or more.
By Saturday night, it’s probable that more than $150 million will have changed hands for what in its simplest form is unproven bloodstock.
That’s the thing about a yearling sale. A horse can have the deepest pedigree, sexiest walk and look like Adonis, but they don’t come with guarantees.
A $1 million purchase can turn to confetti if the horse can’t run and by the same token, a cheap buy can trump the higher profile yearlings on the racetrack.
So what is it that leads successful business people to wager on a comparatively risky investment?
Katie Page, co-owner of Magic Millions became involved in racing in the 1980s through her husband Gerry Harvey and his good friend John Singleton.
She says there’s a myriad of reasons people go to a yearling sale and spend a lot of money in pursuit of — maybe — buying the next champion.
“I came from a non-racing background, so for me it was an absolute eye opener with Gerry and Singo,” she said. “Now, I’m so involved in this industry. It gets in your blood.
“I used to try and work out what it was (that made people want to be involved). But everyone’s got their passion, whether it’s racing or sailing or fast cars, or whatever.
“You have some very well-known people here from all around the world from different businesses (outside the horse industry).
“This is their happy time. They can come here, they can wear thongs, shorts, be doing something they love.
“You can be the brightest in the world, but that doesn’t mean you are going to get that top horse.
“And that drives them berserk as well.
“You hope what you choose, or what you breed, is going to be one of the best.
“That feeling, the adrenalin they want all the time, seeing that horse cross the finishing line.
“I know it’s called Magic Millions, but there is something magical about this industry.”
Since 2006, 195 yearlings have sold for $1 million or more in Australia. The Gold Coast has been responsible for 38 of them.
The highest price was $5 million for Black Caviar’s little brother at the Inglis Australian Easter Yearling Sale in Sydney in 2013. He never raced and died prematurely from a spider bite.
The record at a Magic Millions sale is $2.2 million, both purchased by one-time billionaire Nathan Tinkler in 2008. They never reached anywhere near the heights Tinkler might have hoped.
It’s true many million-dollar babies don’t make the grade, but as Magic Millions managing director Barry Bowditch points out, you only need to have one hit on the board for it to be a good investment, and buyers at the top end tend to spread their risk over a number of horses.
“These (buyers) are engaged in the high product and it’s an investment to them,” Bowditch said.
“Someone buying a good colt could be buying the next Zoustar, Pierro that gets sold for $30-$40 million (as a stallion prospect). There’s a big prize at the end of the day if you get it right.”
Bowditch quickly pointed out there are lots of opportunities for people who play in the lower end of the market, too.
“You only need to look at the Magic Millions race day. There’s cheap horses — $20,000, $30,000 running in the big races.
“The idea of putting 20 friends together to buy a horse has never been easier.
“It doesn’t matter if you are buying a horse for $20,000 or $1 million, the experience is still the same. It’s a hell of a lot of fun.”
John Messara has long been one of Australia’s — and indeed the world’s — most successful breeders. His Arrowfield Stud-based stallion Redoute’s Choice has been worth “hundreds of millions of dollars” to his owners after a $10 million outlay based on his racetrack deeds.
Messara has a long history of bringing associates from the business world into racing.
“Partially, it’s the social interaction that comes from racing, the people you meet, the camaraderie and excitement of the turf.
“It’s not one single factor (that draws their attention to racing),” he said.
“I would say it’s a mix of dream and investment these days.
“With prizemoney the way it is in the two major states (NSW and Victoria), you are buying something that could turn into an investment.
“If they buy a colt and it turns out well, they are buying a significant investment with upside.”
RBA rate cut is ‘same old economic circle jerk’
While many were quick to welcome last week’s rate cut, some say it’s a “bad joke” that’s unlikely to mean much for households because of one thing. HAVE YOUR SAY
‘Spiritual duty’: Minister silent on heavenly housing solution
A priest whose flock sold its church to the government has backed a planned housing solution, but there’s no response from church or state.