THE RACING ASSOCIATION

THE RACING ASSOCIATION
To protect and support the interests of racehorse owners
THE BACKGROUND
• The Racing Association was incorporated in December
1997 following the signing of a Memorandum of
Understanding between the Horseracing Industry in
Gauteng and the Gauteng Provincial Government. The
essence of the agreement, signed on 30 June 1997,
was that the parties agreed to re-organise and
restructure the business of the racing industry into a
single corporate entity to be listed on the
Johannesburg Stock Exchange as soon as practically
possible. The new company would have a broad base
of shareholders with specific emphasis on previously
disadvantaged communities.
Transformation Initiatives
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1) Credit Sale for Black Empowerment Groups (BEGs)
2) Young Achievers
3) Women’s Day
4) Racecourse Tours for Black Owners and Punters
5) Trilogy Racing
6) New Racecourse Project
7) Transkei – Berlin Racecourse
8) Introduction of Black owners to horseracing
9) Groom’s Soccer Field
1) Credit Sale for Black Empowerment
Groups (BEGs)
• In 2002, with the listing of Phumelela Gaming and Leisure Limited,
the Racing Association provided funding to several BEGs in a credit
arrangement.
• The credit arrangement has been the single biggest transformation
initiative of the RA.
• The credit sale involved the provision of funding to enable the BEGs
to acquire a substantial number of shares with a minimal outlay and
favourable repayment terms.
• The beneficiaries of the credit sale included the following BEGs:
- Dihla Investment Holdings (Pty) Ltd
- Gride Investments (Pty) Ltd
- Indyebo Investments (Pty) Ltd
- Vela Phumelela Investments (Pty) Ltd
• 3 of the BEGs are still holders of Phumelela shares which have
appreciated by an average of 200% year on year since 2002.
This has proven to be a very successful initiative. The
companies that still hold Phumelela shares are Gride
Investments, Dihla Investment Holdings, and Vela Phumelela
Investments.
• The initial financial benefit for the credit sale arrangement
was approximately R9 million, excluding the positive effects of
the repayment terms.
2) Young Achievers
• The Young Achievers day was developed as a way to introduce the
youth (aged 18-25) to the sport of horseracing.
• The initiative was started in 2009, where 600 young achievers from
all demographics were invited to, and entertained at, the
Turffontein race course.
• The major draw card was that each young achiever was entered
into a draw to own a 5% share in a racehorse.
• The winners of a 5% share in the racehorse were made up of the
following ethnicities: 5 Black Africans, 2 Indians, and 12 Whites,
with the final share being retained by the RA for control purposes.
• All associated fees for the horse are covered by the RA.
• The next event is scheduled to take place in April 2011.
• Thus far, the RA has contributed over R70 000 to this cause.
3) Women’s Day
• This initiative was started in 2010, with the first event being
held for women’s day (09 August 2010) on Sunday 08 August
2010 at the Turffontein racecourse.
• The RA treated 300 Black African women from the ANC
women’s league, from Rhema church, and from SAFA to a
fantastic day of horse racing, hosted in the Elevation room.
• The event is to be held annually in recognition of the
contribution of women, especially the previously
disadvantaged, to our society as well as to promote
horseracing as a tool for transformation.
• The total cost of the project was between R55 000 – R65 000.
4) Racecourse Tours
• In recognition of the role of Black Africans in the horse
racing industry, the RA marketing committee decided
to introduce racecourse tours for Black owners and
punters.
• The tours take place on a race day where a director of
the RA takes the owners and punters through the
various activities happening behind the scenes to give
them a better understanding of the sport.
• The tour gives the owners and punters a chance to
meet with other owners, punters, trainers, and other
industry personnel.
• The owners and punters are also catered for in the RA
member’s facility.
5) Trilogy Racing
• Trilogy Racing was a syndicate set up by the RA in 2006
in an effort to introduce Black African owners to the
sport of horseracing.
• The syndicate was made up of 8 Black African members
with ownership in 3 racehorses, worth R1 million.
• All of the costs of ownership, in excess of R15 000 per
month, were covered by the RA.
• The initiative proved successful in that 4 of the 8
owners are currently owners in their own right.
6) New Racecourse Project
• The RA is currently investigating the opportunity of opening a
new racecourse in the North, in conjunction with a developer.
• The RA has made it clear that any initiative being supported
by the RA regarding a new racecourse would need to include a
transformation and/or skills improvement initiative.
• The project is set to include either a low-cost housing project,
and/or accommodation for staff, and/or a grooms academy
facility.
• The investigations and plans are proceeding well with the final
draft expected in 2011.
7) Berlin Racecourse Project –
Transkei
• The RA was approached by the community of Berlin, in the
Transkei, to assist in the development of a racecourse in late
2008.
• To date, the RA has contributed a significant amount of time
and expertise to the project.
• The project is in it’s infancy with the Environmental impact
and feasibility studies being conducted.
• Meetings with local government are also being held to ensure
the project meets with local strategy.
• The RA’s objective is to make sure that the project is
sustainable to ensure that long-term jobs are created and that
skills can be broadened which will uplift the community.
8) Introduction of Black African
Owners
• Over the past 4 years, the RA’s marketing committee has
been involved introducing new Black African owners to
horseracing.
• In total, approximately 40 new owners have been
introduced.
• The initiative involved inviting and entertaining Black
Africans at race days, with the emphasis on transferring
racing knowledge and enthusiasm for the sport.
• Tours of the racing facilities and various behind the scenes
functions were also conducted.
• The social nature of horseracing proved to be an important
tool for introducing new Black African owners as the setting
is conducive to the conduction of business as well as
entertainment.
9) Groom’s Soccer Field
• The RA have started fundraising for a groom’s soccer field
which will be built at the Vaal racecourse.
• The RA felt that the isolated nature of the Vaal
racecourse provided little opportunity for grooms to
partake in activities outside of their daily jobs and thus
decided to start a fund to provide a soccer field for them.
• The groom’s soccer fund has raised R30 000 thus far, and
will require a further R70 000 to reach the required R100
000 needed to build the soccer field.
• The RA is planning several fund raising events for early
2011 in a bid to begin the building of the soccer field by
mid 2011.
Commitment to Transformation
• The RA will continue to drive its own
transformation strategy as well as support any
industry initiatives that are in line with the RA’s
goals.
• Creating an environment of equality and equal
opportunity for Black Africans in horse racing
remains a key focus for the RA.
• The concept of Africanisation has been and
remains an important topic discussed at RA board
meetings, the outcome of which have been the
many initiatives outlined in this presentation.