06/04/2007 11:00PM

ClassicStar sells to new venture


ClassicStar, a central Kentucky commercial breeding operation that has been sued by former investors, has sold its two farms near Versailles, Ky., and about 50 mares to a partnership led by the owner of CloverLeaf Farms II, John Sykes.

ClassicStar's managing partner, Tony Ferguson, confirmed Tuesday that he will serve as an adviser to the group, which will operate as Woodford Thoroughbreds. Ferguson declined to disclose the number of partners involved in the new venture.

Ferguson also will continue as managing partner of ClassicStar.

Sykes was in the process of closing the 1,000-acre CloverLeaf Farms II operation in Reddick, Fla., this week, leaving plans for most of the farm's 12 stallions unsettled. CloverLeaf's manager, Brent Fernung, confirmed that he would take over management of three horses - Repent, in whom he has a half-interest, as well as Mass Media and Mongoose - when CloverLeaf closes on July 1. Fernung said he is "scouting out stallion facilities" in the Ocala area.

Sykes is relocating more than 100 mares, foals, and yearlings to the former ClassicStar properties.

"Woodford Thoroughbreds will be hiring most of the ClassicStar employees, so no one is losing their jobs," Ferguson said, "and ClassicStar has been able to substantially reduce its debts and has paid all of its breeding fees. ClassicStar will remain in business, and this allows ClassicStar to focus on cleaning up its remaining issues."

Those issues include a number of pending lawsuits filed by investors in mare-lease programs that ClassicStar operated between 2001 and 2005. According to court filings, former investors in the mare-lease programs allege the operation defrauded them collectively of more than $500 million.

When asked about the lawsuits Tuesday, Ferguson said: "All those suits are working their way through the system. We're still trying to figure out for ourselves what's accurate and what's inaccurate."