08/30/2007 11:00PM

Two join forces in new stallion firm


LEXINGTON, Ky. - Jamie LaMonica, co-owner of Empire Stud in New York, and John Stuart of Bluegrass Thoroughbred Services used to bump into each other all the time on stallion deals, either seeking each other out as partners or bidding against each other for the same horse. Now they've joined forces in a new stallion-only brokerage called The Stallion Company, which opened its headquarters this month in downtown Lexington.

"The Stallion Company is a brokerage firm that specializes 100 percent in the purchase, sale, management, and syndication of stallions," said Stuart, who remains with Bluegrass Thoroughbred Services and also is a vice president at The Stallion Company. LaMonica, The Stallion Company's president, still co-owns Empire Stud in New York with Kurt Butenhoff.

"John and I both see a big future in the stallion syndication market, in the purchase and acquisition of horses," said LaMonica, who will be based in Lexington.

"All the stallion business that Bluegrass Thoroughbred Services did in the past now goes into The Stallion Company," Stuart said. "If we purchase seasons or shares or are involved in a stallion deal, it goes through The Stallion Company."

There are currently a limited number of stockholders, but Stuart said he expects to expand that as the company gets established.

"We are about to complete raising $5 million in a stallion fund known as Champions that The Stallion Company will manage," he said.

"A lot of farms say to a broker, 'I want a stallion that fits this bill, and I want a broker to help me buy it. Then I would like to syndicate the stallion and have someone help me sell those shares and get good mares to the stallion.' Mares are expensive and hard to buy right now. So what we can do through the fund is buy, say, a quarter of the stallion and then use our contacts and expertise to help syndicate the stallion and get mares to the horse."

The idea, LaMonica said, is to create something similar to a hedge fund for the stallion business.

"All the people who are in the fund are basically breeders," Stuart said. "They are people who will participate in breeding to the stallions."

The Stallion Company has struck deals with such pedigree gurus as Alan Porter to provide mating analyses for a breeder's mare and a target stallion. The Stallion Company will pay for the analyses if the breeder agrees to let them purchase the season.

While the company plans to specialize in the central Kentucky area, they are also interested in placing stallions in regional marketplaces.

LaMonica and Stuart are betting that the business trend in stallion marketing is moving back to syndications, rather than smaller partnerships or single ownership, as breeders demand more influence on and potential profit from a stallion's future.

"We've just gone through about a 10-year period where there wasn't much syndicating of stallions," Stuart said. "A lot of the large organizations like Coolmore and Darley don't want partners, and they've been the big ones in the business. I think a lot of breeders want the opportunity, if they're going to support a horse, they want to own some equity in him."

At the same time, LaMonica said, breeding farms trying to "make" new stallions are increasingly interested in bringing dedicated mare owners to their young horse, presenting a matchmaking opportunity between breeder and stud farm that The Stallion Company hopes it can capitalize on.

Australian racing may resume soon

The equine influenza outbreak in Australia has shuttered racing at Sydney's Randwick course, but racing officials in New South Wales - which includes Sydney - hope to start racing again by next weekend, according to local reports. With an indefinite ban on horse transport, the state's racing administrative body, Racing NSW, has applied to the Department of Primary Industries to conduct in-house meetings next weekend at Warwick Farm, Newcastle, and Rosehill. The meets would not be open to the public and would be conducted with horses already on the grounds and with the required licensed personnel, such as trainers, jockeys, and stewards. Under the proposal, the public could wager off-site at Canterbury racecourse's betting auditorium.

In related news, Thoroughbred Breeders Australia president John Messara said his organization will push the New South Wales government to end the transport ban for broodmares.

"Things will be pretty bad if the mares are not served," he told Racing and Sports. "There will be a reduction in the 2008 foal crop, which will flow on to the yearling sales and then to racing."

Booklet a tip sheet for buyers

The Consignors and Commercial Breeders Association has published a buyer's guide to yearling sales in an effort to combat what it believes are market myths about yearlings. The 40-page booklet, titled "Buying Sales Yearlings: Plain and Simple," covers general topics such as developing a business plan and selecting advisers. But it also attempts to counter some conventional wisdom that consignors have often felt caused buyers to turn down yearlings unnecessarily. Among the buyers' beliefs the booklet terms as "myths": that May foals are less successful than earlier foals, that older mares are less likely to produce good runners, and that a poor airway scope result means a horse will be unable to run effectively.

The booklet draws on interviews with trainers, agents, and veterinarians, as well as on some statistical research, such as the nugget that May foals have won 9 Breeders' Cup Miles, 5 of the last 9 Breeders' Cup Distaffs, and 6 of the last 15 Belmonts.