Increased Stakes on Horizon

Date: 13 May 2021

Increased Stakes on Horizon

 

NZ Herald's Michael Guerin reports:

 

The two major racing codes won't dip into their shares of a $5 million bonus payment from TAB NZ until next season but promise increasing stakes will be its primary use.


TAB NZ announced the one-off $5m payment to be split among the three codes this week as they continue to have strong turnover results as well as reduced costs.


The positive financial news for the industry gets even brighter, with indications a combination of TAB NZ's improved performances, the betting levy repeal and extra money earned from overseas betting agencies in betting information charges could see the returns to the industry grow by as much as $20m to $25m for next season.


Last year, more than $139m was returned to the codes, that figure could be as high as $165m for next season.


The TAB NZ returns on betting will be much more profitable than last season but last year's return to the codes was boosted by money from the Government rescue package.


The heads of the thoroughbred and harness racing codes welcomed the payout forecasts and their share of the $5m immediate payment but say they will resist any temptation to immediately boost stakes.


"We will include our share of the $5m, which will be about $2.7m, in our budgets for next season," says NZTR chief executive Bernard Saundry.


Thoroughbred racing gets around 54 per cent of the payment, harness just over 28 per cent and greyhound racing close to 18 per cent and those shares will be used to divide the $5m.


But the exact percentages each will get from future TAB NZ distribution of profits is still being negotiated by the three codes, under the newly-formed Racing NZ.


Even if thoroughbred racing's share doesn't increase, they can expect, including the latest payment, somewhere between $11m and maybe as high as $14m more to play with next season.


Saundry says stakes are a priority for that money but it can't all go there.


"We need cash reserves for a start, to give us cash flow to pay stakes and expenses throughout the season," he says. "We also want to spend money on track infrastructure, the funding of the clubs so they can perform their roles and education and training.


"So we want to put money into all of those things but most importantly stakes.


"We realise that is crucial and the board are all discussing how that will look."


That discussion could include whether stake increases are across the board or more targeted at Saturday meetings and the industry's biggest days.


"Stakes will definitely be going up and we hope to have an announcement on that maybe inside a month," says Saundry.


 

Stakes will be on the increase too with the planned amalgamation of the Auckland and Counties Racing Clubs ... also from the NZ Herald ...

 

The formation of an Auckland horse racing super club to revitalise the struggling industry looks an important step closer even as the sale of Ellerslie's famous steeplechase hill becomes more realistic.


Auckland Racing Club bosses were thrilled with the positive reactions to plans to amalgamate with the Counties Racing Club at their member's forum held in front of 120 yesterday.


The Counties Racing Club held an identical forum last night and members of both clubs will be asked to attend special meetings in late June to vote on the amalgamation.


Ellerslie bosses are forecasting average stake at their track could rise to $100,000 per race inside five years, with 10 races with at least $500,000 on top of the three $1million races held there now.


They would also install a StrathAyr track to provide the region with a world class racing surface while the Pukekohe track will be used for more industry-level racedays as well as have its training facilities developed.


The new mega club, with a working name of the Auckland Turf Club, would have far more scale and therefore the ability rationalise, or sell, some of the enormous real estate holdings alongside the two track in the most profitable manner.


The biggest asset which could ultimately be for sale is the famous steeplechase hill that runs above the Ellerslie back straight and has iconic status among some racing fans even though it is only used for about 10 races a year at its busiest.


The emotional attachment to the hill and jumps racing in general among some in the industry is very real but with so few steeplechase races at Ellerslie and the hill valued at upward of $100million, the reality is selling the most unused piece of real estate in New Zealand racing could enormously help secure the sustainability of thoroughbred racing in Auckland.


Races like the famous Great Northern Steeplechase would most likely be moved to Te Aroha.


"The feedback we got today was fantastic and I think it showed most of our members realise the amalgamation is not only the way forward but something that has to happen," says ARC chief executive Paul Wilcox.


The point may even become a moot one as the advisers Ellerslie is working on about the crucial installation of the StrathAyr track have suggested no jumps racing be held on it, so therefore the hill would become irrelevant.


Members who attended the two forums were also told there would be reduced members fees for five years to allow Counties members to remain members of the new merged club without paying any extra.


For the amalgamation is to go through it will need a 60 per cent yes vote from Counties members at their special meeting and 66.6 per cent from Ellerslie members.


The new mega lub would also work alongside the Avondale Jockey Club, who will retain their name, but are likely to eventually race at Ellerslie from 2026, allowing rationalisation of their assets.


The numbers behind the amalgamation, backed by a independent report from Deloitte, are nearly impossible to argue with, with the new club potentially able to have between $200million and $250million in an investment fund even after the improvement to the Ellerslie track.


The prospect of Ellerslie as the nirvana of New Zealand racing, the track everybody aspires to race their best horses at, with stakes even approaching a $100,000 average, almost sounds too good to be true for most in the battling industry.


But it is realistic, the clubs just need to be given the green light by their members to start down that path.


 

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