01/06/2011 2:46PM

Bigger fees for MVPs? For most, not really

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LEXINGTON, Ky. − A Horse of the Year title represents the pinnacle of Thoroughbred racing achievement in North America, but how much effect does it have on the winner’s breeding career? It can boost a stallion’s first-year fee and the price of a mare’s first few foals, but the title’s influence dims over time as the horse’s talent as a sire or dam becomes breeders’ and buyers’ most important reference point.

This year, the title may have fewer financial implications than usual. A Horse of the Year title for Zenyatta probably would add a premium to her foals, bloodstock experts say. However, owners Ann and Jerry Moss don’t appear likely to put Zenyatta’s foals up for sale. Blame’s stud fee already has been set at $35,000, but first-year stallions are a harder sell now that financially pressed commercial breeders see proven sires as a safer bet.

“Being Horse of the Year when they retire to stud certainly affects the stud fee horses can command going in, but the economy in the industry has been turned completely upside-down for now,” said Eric Hamelback, general manager of Adena Springs Kentucky, which will stand 2004 Horse of the Year Ghostzapper for $20,000 in 2011. “But compared to three or four years ago, it won’t have the drastic effect because of the fact that breeders are turning back toward proven horses. Regardless of that Horse of the Year tag, unless they are from a sire of sires, people are going to be cautious and hesitant about breeding to a first-year horse at this time.”

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In any case, a Horse of the Year title alone will not guarantee breeders’ attention, especially now. Ghostzapper, Hamelback said, benefited in his early breeding career from having the highest average sale price among covering sires and, later, among sires of weanlings.

“Those positives went in line behind his being a Horse of the Year and from a family that was proven, and that all helped him, not just being a Horse of the Year,” Hamelback said. “Being by a proven sire in Awesome Again was helpful.”

“It’s not a meter-mover, especially in this economy,” bloodstock advisor Michael S. Brown said. “But it might make someone take a second look at a stallion.”

Breeder Marty Takacs of Belvedere Farm said a Horse of the Year title doesn’t carry as much weight in itself as other criteria when he considers mares’ mating plans.

“Race record, pedigree, and conformation,” Takacs said. “Those are the three criteria you use when choosing a stallion. If the horse happens to be the Horse of the Year, that always sounds great in the sales arena. If he’s not, that’s fine, too.”

“But if you were Horse of the Year, you probably were a hell of a racehorse,” said breeder Michael Barnett, owner of Blackburn Farm. “That is the kind of horse I want to breed to, for sure. And even in this market I think the Horse of the Year title maintains its value.”
Even so, Barnett said, breeders look closely at the title’s context, analyzing what kind of horses the Horse of the Year beat, his running style, and other factors.

More breeders these days rank “value for money” highly in their criteria, and Horse of the Year can cut both ways on that. If a farm sets a stud fee after a horse wins the title, breeders might perceive they’re paying a premium for that stallion’s services because of the honor. With Blame, the perception could be just the opposite − and to his benefit − some say.

“If Blame doesn’t win Horse of the Year, for him to stand at $35,000 is still good value,” Brown said. “That’s a reasonable stud fee. And it’s 10 or 15 percent more valuable if he does win Horse of the Year. Because if you go to sell a yearling by him in the next couple of years, you can at least put that in your advertising.”

Brown and others estimate that Horse of the Year title can add 15-20 percent to a first-year sire’s stud fee. But other factors will take on even more importance as a stallion’s breeding career progresses. Progeny performance at the races and the sales are significant factors, and so is the bloodstock economy and what the market is willing to bear in a given year.

The equation changes somewhat for fillies or mares who win Horse of the Year. Since 1936, only seven have done it: Twilight Tear (1944), Busher (1945), Moccasin (1965), All Along (1983), Lady’s Secret (1986), Azeri (2002), and Rachel Alexandra (2009). Their scarcity adds value at auction, both for the mares themselves − especially if they haven’t already proved to be poor producers − and for their foals.

Examples are hard to find, but there is a recent one. Last year, Azeri sold to Katsumi Yoshida for $2.25 million while carrying a Distorted Humor foal. Her A. P. Indy son, Take Control, was the year’s most expensive juvenile when he went for $1.9 million to Kaleem Shah. Her yearling Giant’s Causeway filly, Arienza, also sold last year, bringing $800,000 from Robert and Lawana Low. And her current yearling, by Ghostzapper, brought $475,000 from Becky and Jimmy Winemiller.

Lady’s Secret, too, commanded big prices even as the bloodstock boom of the 1980s was turning bust. She sold to Fares Farm for $3.8 million, in foal to Alydar, in 1989. Nine years later, at 16, she and her in-utero Seattle Slew foal brought $750,000 from John Glenney. The median price for her five yearlings to sell at auction is $700,000.

“For a mare or filly to be Horse of the Year, their produce, strange as it seems, is going to be more attractive to the buying public than a stallion’s,” Takacs said. “It’s more unique. You’ve only got one of those foals every year instead of 100.”