JONATHAN QUAYLE HIGGINS
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A Massive Task with Complicated Issues

Hand it to South Africans, they don’t lie down. Their rugby team is a prime example and their citizens, on the whole, are starting to show an increased and bitter dissatisfaction with the theft and mediocracy among their leaders. I took some interest in their recent municipal elections and it appears they have made some progress in eroding the electoral advantages held by the frightfully incompetent thugs in charge of this land.

There is a long way to go still, and one can argue that there are parallels between South Africa’s government and its horseracing industry – one is occupied by thieves and is heading for a collapse; the other was taken from same and in urgent repair after an unavoidable collapse. Both took about a quarter of a decade to have its cupboards stripped bare, and both face crises of survival.

For fear of having to suffer another outburst from an offended South African drama queen, let me leave further adjectival phrases aside. But most will know what I mean. The recovery of SA racing, in many ways, is coupled to the economic recovery of the country itself. Racing’s revival is inexorably linked to the financial recovery of the Republic, and the new individuals in charge are well aware of this. They’ll have to play clever for every rand in the tight leisure market.

Last week, the Gambling Board in Gauteng (the biggest SA province), granted operating licences to 4Racing, the new company borne from a lifeline thrown to the industry by the prominent Oppenheimer family, to pave the way for it to assume management of Highveld Racing operations.

Fundi Sithebe, 4Racing’s Chief Executive Officer, said: “The transfer of the operating licences from the Gauteng Gambling Board to 4Racing is a major step forward for the South African horse racing industry. It gives 4Racing the opportunity to bring stability to the industry and to the over 1000 people currently employed by Phumelela.

“We have been hard at work in preparation for the granting of all licences we have applied for and for the completion of the transaction with Phumelela and we will soon share more concrete details of our future vision.”

Phumelela, the company that ran racing into the ground, is presently in business rescue with most of their executives having secured exit packages with non-disclosure agreements to protect them should they wish to move on to other fields of industry ripe for plundering.

Phumelela is finally on its way out – the Business Rescue Practitioner (BRP) will be wrapping matters over the next few months but, in reality, this is just the beginning of the road for 4Racing, who now face the gargantuan task of clearing the rubble and laying the foundations for a strong new industry.

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Everyone in the South African racing industry, and most in racing’s global village, will be holding thumbs that 4Racing’s new house gets past ‘window height’ and that they can turn this around, and I had a chat to the company’s (very accommodating and forthcoming) Chief Operating Officer, Colin Gordon, about the issues facing them, last night.

With restless and demanding industry players and fans waiting to see some ‘action’, Gordon called for patience and explained: “Imagine a major business in the process of taking over another, for example Mercedes Benz taking over BMW. You would have vastly experienced management teams on both sides overseeing it and co-operation from both parties ahead of the merger or acquisition.

“What we have here, however, is a company in business rescue on the one side. On the other we have a management team in waiting for the various condition precedents to be met. These not only include competition commission approval and terms they in turn lay down but also the granting of the various provincial gambling licenses. Till those are in place you have significant restrictions regarding your involvement.

“Then there is the management of our racecourses and other assets, and the day-to-day running of racing in our regions, which are Gauteng, the Vaal and the Eastern Cape. We can now finally get down to the business of managing racing as we see it, but there will be transitions of duties and functions in this respect, and our CEO and her executive team are addressing them. Announcements will be made shortly.”

There is a perception among racing fans that 4Racing is responsible for the embattled racing channel Tellytrack, but Gordon said: “We did not buy Tellytrack as it’s a partnership between the existing operators. We’ll be launching our own channel, 4Racing TV, in due course.”

Gordon added: “Getting the gambling licence was the key to it all. The wheels were in motion, but will now turn faster and I can assure everyone that we are acutely aware of the situation we’re in. There is no easy way, this process will take more time, as explained, and we’re appealing for support in this.”

There are a number of clear basics in the plan 4Racing has drawn up and Gordon said: “Racing has to become relevant to all South Africans again, a great number of bettors were lost to other forms of gambling over the last two decades, and we have to do everything in our power to get at least a proportion of them back.”

Absolutely central to all of this, Gordon said, was the development of the TAB (Totalisator), both as a retail and digital offering. He said: “The tote is expressly the heart of our business and we know that we cannot possibly succeed in the long term without getting it modernized and able to serve our customers quickly and efficiently.

“We have to make our online totalisator facility a word-class service, this is essential. It appears the business did not historically invest in digital development to the extent that other competitors in the betting market did, and we need to change that.

“From the outside we’ve been working on some improvements as we’ve gone along. The tote is number one on our agenda and more solutions and announcements will follow.”

Gordon stressed: “The stakes pot, as you know, was historically funded from totalisator proceeds, and we’re again appealing to punters to give us their support. Regardless of the business model, the revenue generated via tote pools play a major role in offering sustainable stakes. We know that punters have other options, but we want to win them back and build up our pools. We also want to partner with bookmakers who see the value of a healthy industry and find ways to get pool bets back in the pools.

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“We will also be addressing tote innovations. We want to offer a range of attractive promotions and hope to work with the Gambling Boards in the respective regions to facilitate this.”

Alongside the tote, 4Racing has prepared a pricing inventory with attractive options for corporates and small business sponsorships.

“We can custom design excellent packages for race sponsors, big or small, and we’d really like to include all budgets. Sponsors’ budgets are tailored to include as much exposure for their brand as possible, entertainment for their guests, naming rights, and a proportion of the budget will boost the stakes for a race, or the races on an entire day.

“We prefer to refer now to ‘partnerships’ instead of ‘sponsorships’ and we’re asking racing fans to consider what we can offer by way of a superbly exciting day out with great value for their clients and the best advertising exposure we can offer.”

Donovan Everitt is overseeing this and he can be reached on:

donovan@highveldracing.co.za

donovan@caperacing.co.za

 

 

 

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