Thursday, April 22, 2010

Daily Kentucky Derby Hype Meme: Who Wants to Buy the Favorite?

A frequent topic of coverage for the Derby are the horses' owners, how they got there, what they do, and why they're into racing. Normally the owner of a horse is only a worthy topic of conversation if there's a good story involved. Think back to Alex's Lemonade Stand, Frances Genter, or even the irrascible Mike Pegram; all involved characters or human interest stories. We don't love these stories because they're not really relevant to the race, but we recognize that lots of people who aren't big sports fans do care. Otherwise, the Olympics wouldn't get ratings.

With that in mind, let's turn to the owner of this year's big favorite Eskendereya, Mr. Ahmen Zayat, owner of Zayat Stables. Zayat is hardly a stranger to the Derby--he owned last year's runner up Pioneerofthe Nile, our pick to win the 2008 Derby, Z Fortune, and a few other longshots. We've never met him, know very little about him other than he spends a lot of money on horses, and have no opinion on him as a businessman or human being.

What we do know is that Zayat Stables has filed for Chapter 11 bankruptcy. What's more is that as part of his reorganization plan, Zayat has stated he intends to sell Eskendereya at the end of the year to pay off the sizable debts he owes. Against all odds, this has started to pick up steam as a story, and will no doubt reach a crescendo next week. After all, the press loved the stories about the principals of IEAH being involved stock scams, so why wouldn't they love stories about the owner of the Derby favorite (who's Middle Eastern, to top it off) going bankrupt and being forced to sell his prized horse?

As the linked article shows (and anyone with a PACER account can learn_, it is not abnormal for a bankrupt party to state its assets and how it intends to dispose of them. But, even as a pair of attorneys, we cannot say we're remotely interested in how this pans out. Win or lose the Derby, there's about a 90% chance that Eskendereya will not race past this year and Zayat would have sold all or part of him to another breeding stable. The fact that his farm is insolvent doesn't change this fact.

Moreover, the Chapter 11 proceeding really has no bearing on the race itself. Eskendereya is not being trained or operated differently because his owner is in a financial pickle. He's not going to be scratched to be sold on Friday morning. To the contrary, if anything, this gives the connections one more reason to push for the Derby title, because if he wins, he'll be worth at least $10 million to a breeder, even in this depressed stallion market.

We were prepared to give this story a 6 based on its irrelevancy, but upon further reflection, legal tales generally and bankruptcy stories specifically are about as boring as you can find. We use sports to escape from the humdrum of legal problems and financial concerns, not to tell us more about it. Thus, let's give it a 25% bump to 7.5 on the BS Scale.

1 comment:

Teddy said...

In case you couldn't tell, Ang is the brains of the racing operation around here. So, grains of salt for anything I say.

That said, this meme has inspired a suggestion: run an Kentucky Derby Owner's Stakes sometime on Oaks Day. Who wouldn't have kicked in a few bucks a few years back to see a footrace between multiple sheiks, one horseflesh hedge fund manager, the drunk guys who owned Funny Cide, and Marylou Whitney?