Beholders of racing don't see eye to eye

3 industry titans, joined by Crown, have bitter history with each other

Horse Racing

July 18, 2002|By Jon Morgan | Jon Morgan,SUN STAFF

Among the unwritten rules in horse racing circles is this: If you're holding a dinner party, don't seat at the same table Tom Meeker, Barry Schwartz and Frank Stronach.

The men head three of the biggest organizations in racing, Churchill Downs Inc., the New York Racing Association and Magna Entertainment Corp. But they hold different visions of the sport's future and share a history of testy relations.

Now, they will share a board, if not a table, through Triple Crown Productions LLC. Together, they must decide how to divide millions of dollars among themselves.

The organization, founded in 1986, promotes the three-race Triple Crown series and negotiates broadcast and sponsorship deals.

It is controlled by the owners of the races: Churchill Downs for the Kentucky Derby, the Maryland Jockey Club for the Preakness Stakes and NYRA for the Belmont Stakes.

Magna agreed Monday to buy the jockey club, giving the company and its maverick chairman, Stronach, a stake in the prestigious race series.

"We all have had a different view of racing," said NYRA chairman Barry K. Schwartz. "Frank's view is Frank's view. Tom is running a public company that is interested in the bottom line. I am running a state organization that is trying to make New York racing the best in the world."

Last year, a group headed by Stronach had the winning bid to buy New York's $1 billion-a-year off-track-betting network from the city, though the contract lapsed when state lawmakers failed to give approval.

The NYRA had joined with Meeker and Churchill on a rival bid, and Schwartz ridiculed the city's selection.

"We can't understand how the city could make such a stupid decision.

It goes against the industry, the players and all interested in the welfare of New York racing," Schwartz told The Blood-Horse magazine.

Soon afterward, Stronach, speaking at a conference in Saratoga Springs, N.Y., said he would like to buy NYRA, a nonprofit that operates Aqueduct, Belmont and Saratoga race courses. "It needs investment. It needs jazzing up," Stronach said, according to the Daily Racing Form.

If Stronach were to take over NYRA, Schwartz told The Blood-Horse, "it would be a complete and colossal disaster. ... I haven't seen one racetrack he's improved."

This week, Schwartz, who is also the founder and chief executive of fashion powerhouse Calvin Klein Inc., was more diplomatic, saying: "Business is business and we each have to do what we have to do. ... It would be really stupid if he were to change the Triple Crown."

As for whether the three men can work together, Schwartz said, "That remains to be seen."

Stronach, a self-made billionaire, and Meeker, an ex-Marine, have bid fiercely against each other on a number of racetracks, including Maryland's. The two share a vision of racing that is driven by fan-friendly amenities and expanded simulcasts of racing via computers and TV.

But each wants to dominate the sport. And they have pursued their visions differently, with Meeker cautiously assembling a chain of high-quality tracks and signing up with a third-party television network, TVG. He has also been a leader in efforts to corral the sport's stampeding interests through the National Thoroughbred Racing Association.

Stronach, by contrast, has paid top dollar for more than a dozen tracks in the past four years and insists on running his own computer and television wagering systems. He has been disruptive of industry efforts to unify, at one point leading a mutiny of NTRA members.

"Meeker gets red in the face when Stronach's name comes up," said someone who knows both men and spoke on the condition of anonymity.

Meeker was unavailable for comment, and a spokesman for Churchill Downs, Karl Schmitt, declined to discuss Stronach. Noting that Maryland Jockey Club president Joseph De Francis will remain under a five-year management contract with Magna, Schmitt said: "We have an excellent relationship with the Maryland Jockey Club and the De Francis family and see no reason for that to change."

Ravens owner Art Modell, who is one of Churchill's representatives on the Triple Crown board, said: "Stronach is not going to go out on his own. The Triple Crown is here to stay."

Stronach was unavailable for comment. Magna president Jim McAlpine, who often sits on boards in Stronach's place, on Monday told the Los Angeles Times: "This should make it fun. There should be some interesting board meetings. But we all have a common interest - the growth of racing - and if we work together we should all prosper."

Richard Wilke, an executive in residence with the University of Louisville's equine business department, said Meeker and Stronach "are not dinner buddies. They are different kinds of people. You don't get to be a Meeker or a Stronach without being a tough-minded, sometimes aggressive person."

De Francis said he expects to represent Magna on the Triple Crown board. The meetings, he said, are often contentious as each representative argues for a greater share of the earnings.

The Triple Crown's current pacts with NBC and Visa run through 2005. NBC is reportedly paying about $10 million a year, and Visa is paying $3 million a year.

As for Meeker and Stronach, De Francis said: "They have battled in the past. They are competitors in business, but they have a common interest in the Triple Crown. I don't believe there is any personal animosity."

Would he invite them to the same party?

"That depends on how many tables you have," De Francis said.

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