04/09/2008 11:00PM

Dubai company buys Fasig-Tipton


LEXINGTON, Ky. - In a development that rocked the bloodstock sales industry, the Fasig-Tipton auction house announced Thursday that it has been purchased by Synergy Investments Limited, a Dubai-based company with close ties to Sheikh Mohammed al-Maktoum.

The announcement issued Thursday afternoon described Synergy as being headed by Abdulla al-Habbai, "a close associate of Sheikh Mohammed."

Maktoum, the ruler of Dubai in the United Arab Emirates, is the Thoroughbred industry's dominant owner, buyer, and breeder, with farms and other equine facilities in Kentucky, England, Dubai, Ireland, Japan, and Australia.

The Fasig-Tipton purchase was conducted privately and no price was revealed, but the deal does include "substantially all the assets, including the Kentucky real estate and its improvements and the Saratoga real estate and its improvements," said Fasig-Tipton chief operating officer Boyd Browning. Current staff are expected to remain in place under the agreement.

Fasig-Tipton is headquartered at its Newtown Paddocks facility north of Lexington, which covers approximately 200 acres and includes a sale pavilion and banquet facility as well as barns and offices. The Saratoga sale pavilion and barns are located across Union Avenue from the Saratoga Racecourse in Saratoga Springs, N.Y., and cover about six acres. Fasig-Tipton also conducts sales at Timonium in Maryland, at Calder Race Course near Miami, and Lone Star Park in Texas, but does not own the facilities at those locales.

Last year, Fasig-Tipton sold a total of 3,817 horses at 17 auctions for gross receipts of $241,330,800.

Browning said Maktoum initially inquired whether Fasig-Tipton would be willing to sell through his chief bloodstock representative, John Ferguson, in the days leading up to the company's Calder select 2-year-old auction on Feb. 26.

"The initial question was to ask me whether there was any interest," said Browning, who worked closely on negotiations he described as "simple and straightforward."

Ferguson could not be reached for comment Thursday but indicated in the announcement that, beyond horse sales, a broader marketing and promotion of the Thoroughbred sport would be part of the new Fasig-Tipton mandate.

"Synergy plans to devote future operating surpluses to higher levels of customer service and renewed efforts to promote North American racing and breeding," Ferguson said.

Browning said: "One of the marching orders we've got is to be thinking about how to attract new owners to the game, and how do we make the game more interesting and exciting to potential participants."

Fasig-Tipton chairman D. G. Van Clief Jr. said in the announcement: "Our agreement includes an understanding that Fasig-Tipton will be operated in a manner consistent with the principles of integrity, customer service, and industry service which have been so critical to our success since controlling interest was obtained by the [John] Hettinger family in 1991. Those assurances were critical to John and his son Bill Hettinger, and our entire board of directors, in agreeing to this transaction."

Fasig-Tipton is a corporation with 45 shareholders, with the majority shareholder being John Hettinger, a New York-based breeder and owner of Akindale Farm, and his family.

The announcement took many in the bloodstock business by surprise and adds a significant twist to the historical rivalry between Fasig-Tipton, founded in 1898, and its newer auction-house rival, the Keeneland Association, which began hosting sales in 1943.

Keeneland conducts fewer auctions, hosting four sales at its Lexington facility, but has outstripped Fasig-Tipton in terms of gross revenue by often selling a vast number of horses at its January all-ages, September yearling, and November breeding stock auctions. Last year, Keeneland grossed $815,401,000 on the sales of 9,124 horses.

Keeneland president and chief executive officer Nick Nicholson issued only a brief statement in response to the sale announcement, saying: "The purchase opens a new chapter for an historic, well-established company in the Thoroughbred auction business."

Browning said of Fasig-Tipton's immediate future: "I don't think there are any changes contemplated on a short-term basis in terms of management or the direction or the employees. I think we have an opportunity with a blank canvas in front of us to dream, to think, to create, to imagine.

"On a short-term basis, I can promise you this: we'll be out looking at yearlings tomorrow for July and Saratoga. In that regard, it's business as usual. But we can be little more imaginative, and we'll have resources behind us that will enable us to do a better job in the future."