03/04/2011 12:14PM

Avioli resigns from Breeders' Cup; to work for Stronach

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Bill Denver/Equi-Photo
Greg Avioli from 2007.

Greg Avioli resigned as president and chief executive officer of the Breeders’ Cup on Friday in order to take a new position managing the racing assets that Frank Stronach is expected to control by the end of March, according to Breeders’ Cup and several racing officials.

Avioli, who had been head of the Breeders’ Cup for five years, is expected to be named chief executive of the company Stronach plans to form if shareholders approve a complex deal that will allow him to swap his supervoting shares in MI Developments, a company he heads and controls, for all of the company’s racing and gambling assets, including Santa Anita Park and Gulfstream Park. Shareholders are expected to approve the plan on March 29.

Early on Friday afternoon, MI Developments issued a statement saying that Avioli had signed an employment agreement as “president and CEO of the racing and gaming division of MID.” However, the division will be dissolved should the company’s shareholders approve the deal.

“I look forward to implementing Frank Stronach’s vision,” Avioli said in the statement. “I feel privileged to have the opportunity to work with one of the great leaders of our industry, Frank Stronach.”

Avioli had not returned a phone call by Friday afternoon.

The sudden resignation is expected to set off an intense scramble to name Avioli’s replacement. The 13-member Breeders’ Cup board – which is currently divided into three factions – is scheduled to meet next week to devise a strategy to name a replacement, and the three factions are expected to favor candidates with widely different backgrounds and views, according to officials familiar with the board.

In a release, Breeders’ Cup chairman Bill Farish said that the organization’s board will “discuss interim leadership and steps to be taken to identify the organization’s next CEO” during the meeting. The search is expected to take at least three months, according to officials.

“The board looks forward to identifying a new CEO that can continue to grow the property and fulfill its mission in support of breeders and the industry,” Farish said.

Avioli was paid a total of approximately $832,000 in annual compensation in 2007, according to the organization’s latest available tax return.

A former marketing official with the PGA Tour, United States Tennis Association and International Olympic Committee, Avioli first entered the racing industry in the late 1990s as part of an effort to form a national marketing organization for the sport. He was later named deputy commissioner of the organization that was formed, the National Thoroughbred Racing Association, and in 2006 he took the head job at Breeders’ Cup when the organization’s operations were combined with those of the NTRA. The combination was later dissolved after Breeders’ Cup directors became critical of the arrangement.

Most notably during Avioli’s five years at the organization, the Breeders’ Cup year-end event expanded from eight races to 14 races and was split into two days. Purses for the races increased from $15 million to $25.5 million, as the Breeders’ Cup attempted to keep pace with the heady purses offered in Dubai for its one-day World Cup event in March.

According to an internal document obtained by Daily Racing Form, total revenue from the Breeders’ Cup event during Avioli’s tenure was $28.5 million in 2006 at Churchill Downs; $29.3 million in 2007 at Monmouth Park (the first two-day event); $28.7 million in 2008 at Oak Tree at Santa Anita; $25.7 million in 2009 at Oak Tree; and a record $33.6 million in 2010 at Churchill. This year’s event is also scheduled for Churchill.

Should the swap deal at MI Developments be approved, Avioli will head up a company that includes Santa Anita and Golden Gate Fields in California; Gulfstream in Florida and its adjacent casino; Laurel Park and Pimlico Racecourse in Maryland; the account-wagering company XpressBet; the bet-processing company AmTote, and a half-stake in the horse-race broadcasting company HRTV. Daily Racing Form recently launched a betting service that sends wagers through XpressBet’s operations.

The assets and other racing properties owned by Stronach’s companies have lost hundreds of millions of dollars over the past decade and led to the bankruptcy of Magna Entertainment Corp. in 2009. MI Developments, Magna’s parent company, took over the assets early in 2010, and Magna was dissolved.

Santa Anita has hosted the Breeders’ Cup five times, most recently in 2009. Gulfstream has hosted the Breeders’ Cup three times, but the track is no longer considered a viable candidate because of a recent renovation that reduced the track’s capability to host large events.