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Falling pound lights up dollar signs in racehorse sales supremo

NEWMARKET (UNITED KINGDOM) (AFP) – 

There may have been much negative press about the dramatic fall in the pound’s value but for Tattersalls chairman Edmond Mahony it augurs well for his business.

The softly-spoken Irishman, who has been chairman of Europe’s leading bloodstock auction house for 23 years, told AFP he expected the positive fallout from the pound’s decline from his company’s point of view to be felt most come the December breeding stock sales.

“Well I suppose one of the unintended consequences of the Brexit vote is that the pound has fallen considerably since June,” Mahony said after a session on the auctioneers rostrum at the highly successful fortnight long yearling sales in Newmarket which came to an end on Friday.

“So we saw rises of about 25 percent at our sales in July and I think a lot of that was attributable to the competitiveness of the dollar and the euro against the pound.

“It hasn’t been so noticeable at the yearling sales but I think at the breeding stock and fillies out of training sales in December it will become quite an important bit of sustaining the market here.

“I think a lot of purchasers particularly of breeding stock tend to think in terms of dollars rather than pounds or euros and I think because of the competitive nature of the pound against the dollar that will have an effect.”

Mahony, whose most treasured riding accoutrement is a hunting jacket given to him by the late former Speaker of the House of Commons Bernard Weatherill who was a tailor by profession, says he is not concerned the large group of Irish vendors will prefer to sell at home if the pound continues its fall.

“I think the beauty of auction situations is that it is not a fixed price so they go up and down according to currency,” he said.

“It is not quite as relevant as maybe when you are selling at a fixed price.

“So I think what influences people coming here is to meet the right market for the right horse.”

Mahony, an accomplished showjumper and huntsman, has just overseen a bumper yearling sale at an auction that has produced seven of the past 16 Epsom Derby winners.

A total of 1,306 lots sold for 132,705,800 guineas (£1.05 to a guinea), with the average and median up 19 percent and 30 percent respectively to 101,612 guineas and 52,000 guineas whilst nine yearlings were knocked down for over 1million guineas and two topped the sale at 2.6m guineas.

Mahony, who has auctioneering in the blood as his father Denis was a noted auctioneer, has been especially encouraged by the number of new faces.

“There were a lot of young Middle Eastern buyers (largely from Qatar and Dubai) who in many cases have just joined the ownership ranks and it was gratifying to see them buying in person,” said Mahony.

“It was also very good to see so many young agents who have just started buying this week and bringing a different generation to the game as we all get a bit fed up of seeing tired old faces,” he added grinning.

He admits it is not the parlous state of English racing’s prize money — in an industry that supports 85,000 jobs and is worth an estimated £3.45bn to the economy — that is attracting these new owners to the sales.

“Owners in Britain are very resilient in terms of prize money,” he said.

“I think they view prize money as a contribution towards their losses rather than a moneymaking exercise.

“I think it’s always important to realise that if you buy a racehorse you’re really doing it for the love of the sport rather than a financial benefit.

“I think most owners view it like that.

“Having said that of course getting a prize money structure which actually makes more financial sense would of course mean we get more owners and horses and have a healthier industry as a result.

“However, I think the Holy Grail of extra prize money is still some way off.”

© 2016 AFP

Article source: http://www.france24.com/en/20161016-falling-pound-lights-dollar-signs-racehorse-sales-supremo