03/06/2009 12:00AM

Southern Equine wants to downsize


LEXINGTON, Ky. - Southern Equine Stable plans to scale down its 300-horse operation by about one-third over the next year and will consider selling its world-record-priced broodmare Better Than Honour if it receives a sufficient offer, according to Southern Equine partner and trainer Eric Guillot.

Southern Equine bid a world-record $14 million for Better Than Honour to dissolve its partnership with Hill 'n' Dale Farms, but because Southern Equine already owned 70 percent of the mare, the purchase price effectively was $4.2 million for the remaining 30 percent. Better Than Honour, now 13, is the only mare to produce consecutive Belmont Stakes winners - 2006 victor Jazil and 2007 heroine Rags to Riches. She was barren in 2008.

Guillot said while Southern Equine would consider offers for the 2007 Broodmare of the Year, he would not be surprised if the group could not come to terms on a sale during the recession. A number of bloodstock experts estimated Better Than Honour's current value to be between $5 million and $8 million.

Instead, Guillot said, the operation is considering selling about 100 horses, mostly in its Louisiana program, a move he said he had wanted to make even before the economy dropped off.

"The bottom line is that we've just got too many horses," Guillot said. "That's too much grooms, hotwalkers, too much operation. I can cut $150,000 off a month that operation. . . . We have a Louisiana program that's big and gotten bigger, and now it's time to carve it out."

Southern Equine also has halted construction on the former Parrish Hill Farm, a historic 300-acre property in Midway, Ky., that is likely to be sold, Guillot said. Southern Equine bought the land in June from Tom Roach and family, longtime Thoroughbred breeders who raised such champions as Princess Rooney and Charismatic there. Southern Equine razed all the barns and removed fencing soon after acquiring Parrish Hill, with the intent of building new, state-of-the-art facilities there. But the credit crunch and economic downturn have made ambitious construction, as well as expensive staffing of a farm, more difficult. Guillot said Southern Equine's 200-acre farm in Sunset, La., could handle additional horses under a slimmed-down operation, and "two years or a year and a half from now or whenever when the whole world is back on its feet, we'll just buy a turnkey farm, ready to go."

Southern Equine co-founder Michael Moreno's oil-related services business, Dynamic Industries, also is weathering steep declines in oil prices. But Guillot emphasized that the downsizing at Southern Equine was a logical focus on quality rather than quantity.

"I'm going to put them up for sale, and if somebody comes along and makes an offer that's good, fine, but it's not a fire sale," he said of any horses Southern Equine puts on the market. "I've got a million calls from Kentucky from people thinking we're desperate, we're broke, and we want to sell for pennies on the dollar. That's not true."

Moreno was traveling and could not be reached for comment by late Friday afternoon.

Southern Equine, founded in the late 1990s by Moreno and Guillot, has grown into a major purchaser at bloodstock auctions in the last five years. In addition to Better Than Honour, the stable also owns a number of other Grade 1 performers, such as 2006 Del Mar Debutante winner Point Ashley; Grade 1 producers such as Irish Cherry, dam of Spun Sugar and Daaher; and well-bred mares such as Crystal Current, a stakes-winning full sister to Grade 1 winner Majestic Warrior.

Breeder fondly recalls Desert Party

Among bidders at Fasig-Tipton's Calder select 2-year-old sale on Tuesday in Miami was the man who bred last year's Calder sale-topper, $2.1 million Desert Party, now a Triple Crown hopeful for the Maktoum family's Godolphin stable.

David Smith, who bred the Street Cry colt in partnership with Steven Sinatra, owns Wayward Wind Farm in western Kentucky and has been in the horse business for 30 years.

"I knew immediately when he was born that he was special," Smith said of Desert Party. "I foal all the mares out myself, and within five minutes he was up and nursing. He's always had a mind of maturity. And I think we're seeing that now."

Smith and Sinatra paid just $20,000 for Desert Party's dam, Sage Cat, at the 2005 Keeneland November mixed sale. She was carrying Desert Party. Smith and Sinatra eventually sent the foal to Hunter Valley Farm for sales-prepping, and they were the consigning agent when he brought $425,000 for his breeders at Keeneland's 2007 September yearling sale. Paul Pompa Jr., of Big Brown fame, was the buyer then and pinhooked Desert Party to his $2.1 million sale at Calder.

Smith, a former Quarter Horse breeder, said he's big on conformation when he selects matings for his mares, but acknowledged that sending Sage Cat back to Street Cry in 2009 was a no-brainer. Sage Cat foaled a Ghostzapper filly last month, and Smith said the partners are inclined to keep her. But they would consider selling 11-year-old Sage Cat, who also is the dam of 2008 stakes winner Elliecat.

"I guess everything's for sale," Smith said with a laugh. "Most of the great mares outproduce themselves, I've found. She just has the ability. And she has a lot of heart and presence."