Updated on 04/05/2017 2:05PM

Pegasus World Cup to be worth $16 million in 2018

Email
Barbara D. Livingston
Next year's Pegasus World Cup purse will increase to $16 million.

The Stronach Group will contribute $4 million to next year’s Pegasus World Cup to boost the race’s purse to a world-record $16 million and dramatically raise the minimum amount each starter earns from the purse regardless of finish position, company officials said Wednesday, in a move designed to bolster what was expected to be lackluster demand for the 12 slots for the race.

The announcement came four days after The Stronach Group, a privately held company founded by billionaire owner and breeder Frank Stronach, wrapped up two days of meetings with the 12 parties that bought $1 million slots in the inaugural Pegasus, held Jan. 28 at The Stronach Group’s Gulfstream Park in south Florida. The Stronach Group was expected to make major changes to the race because most of the slot holders lost hundreds of thousands of dollars on their investment this year.

Tim Ritvo, vice president of racing for The Stronach Group, said on Wednesday that the exact formula for distributing the $16 million purse has not been set, but each starter will receive at least $650,000, no matter where the horse finishes. Last year, each starter was guaranteed $250,000, the amount that was paid out to the fourth- through 12-place finishers.

Under the new formula, the horses running fourth through 12th would receive a collective $5.85 million of the $16 million purse next year, leaving $10.15 million to be distributed to the first three finishers. This year, $2.25 million was distributed to horses finishing out of the money, leaving $9.75 million to be distributed to the first three finishers, a difference of $400,000.

Slots for next year’s race, scheduled for Jan. 27 at Gulfstream, are already being offered for sale, Ritvo said. The owners of the 12 slots this year have a right of first refusal on buying a slot for the 2018 race.

“We’re telling people to get in touch with us,” Ritvo said. “We’re putting the list together right now.”

This year’s Pegasus was won by Arrogate, widely considered the top horse in the world. Arrogate recently won the $10 million Dubai World Cup impressively, and the Pegasus is likely to be back on the horse’s radar, even if owner Prince Khaled Abdullah’s Juddmonte Farms doesn’t exactly need the money. Arrogate earned $7 million for his Pegasus win and, with the Dubai World Cup purse this year, has earned $17.1 million, becoming the richest horse in North American racing history despite having only raced eight times.

The presence of Arrogate and 2016 Horse of the Year California Chrome in this year’s Pegasus put other slot owners solidly behind the eight ball in trying to secure horses for their $1 million slots. Most reached deals in which owners of potential starters in the race were able to dictate highly favorable financial terms, while others, such as Paul Reddam, started third-string horses from their own stables.

The owners of slots in the 2017 race also were entitled to shares in several revenue sources tied to the race, but those sources were not expected to exceed $150,000 for each slot owner. With the minimum purse distribution of $250,000, most slot owners lost at least $600,000 on their initial investment.

One slot owner in the 2017 Pegasus, Mick Ruis Sr., a recently unretired trainer who also owns horses, said he plans to buy another slot for the 2018 race. Ruis started a horse he owns, War Envoy, in his slot this year after a deal to secure the top handicap horse Gun Runner fell through because the horse could not clear a quarantine at Fair Grounds in New Orleans. War Envoy finished 11th.

“Yeah, we’re going to do it again,” Ruis said. “I can’t say I was satisfied because I couldn’t get a top runner like Gun Runner in this year, but it is what it is. That’s horse racing.”

Ruis declined to say how much money he lost on this year’s slot.

Ritvo declined to say how much money was distributed to the slot owners as a revenue share from the 2017 race. He said the revenue-share agreement for the 2018 race is likely to be similar to this year’s agreement, which entitled slot owners to shares of most of the handle on the race and advertising and sponsorship tied to the Pegasus.

Ritvo said several of the slot owners in the 2017 race have “expressed an interest” in buying a slot for 2018. The slot owners this year included Stronach, whose horse Shaman Ghost finished second and earned $1.7 million, and Jack Wolf, the owner of a racing partnership who was hired by The Stronach Group last year to administer several aspects of the race. The horse starting in Wolf’s slot, Neolithic, finished third, earning $1 million.

The increase in the purse for the 2018 Pegasus is also likely to trigger a move by racing officials in Dubai to raise the purse of the World Cup. After the World Cup was run last month, Sheikh Mohammed bin Rashid al Maktoum, the ruler of Dubai who runs an international racing and breeding operation, told media outlets that a purse increase was planned for the 2018 running, in large part because of the Pegasus.

“I always want to be one step ahead,” Maktoum told CNN.