Bloomberg News

Melbourne Cup Goes Global Luring Qatari Sheikh, U.K. Bettors

November 05, 2012

The Melbourne Cup

The Melbourne Cup is displayed during the 2012 Melbourne Cup Carnival launch at Crown Palladium on Oct. 29, 2012 in Melbourne, Australia. Photographer: Scott Barbour/Getty Images

The Melbourne Cup, billed in Australia as the race that stops a nation, is riding the recent string of international winners to bolster its appeal elsewhere.

When the 24 horses line up for the A$6.2 million ($6.4 million) handicap tomorrow, organizers expect a Flemington Racecourse crowd topping 100,000, while about A$150 million is set to be wagered nationally according to Tabcorp Holdings Ltd. (TAH) U.K. bookmakers say they expect a record 4 million pounds ($6.4 million) in bets on a race that’s available live or on replay to an estimated 760 million homes in 120 countries.

Global interest in an event that commands the attention of three quarters of Australia’s adult population has been increasing since the Victoria Racing Club opened the 151-year- old race to international horses in 1993. Four of those have left as winners in the past decade, with last year’s victor Dunaden one of six overseas runners in the top seven places.

“Certainly the horses have been a catalyst in terms of the interest in the race overseas,” Dale Monteith, the VRC’s chief executive officer, said in an interview. “Now it’s recognized as an international event. The brand of the Melbourne Cup is much stronger now. The awareness level of it certainly.”

French stayer Dunaden returns to try to secure back-to-back wins. The seven-year-old tuned up by winning the Caulfield Cup on Oct. 20, a triumph that cost him a 1-kilogram (2.2 pounds) weight penalty for tomorrow’s race. Were he to win it with 59 kilograms, it would be the biggest weight carried to victory in 37 years.

Unique Race

For Dunaden’s owner, Sheikh Fahad bin Abdullah Al Thani, the cost and risk of sending a horse to Australia, which can involve a 30-hour trip, are worth it.

“It’s a long way, but once you’ve tried it, it’s like a bug,” the Qatari royal said in an Oct. 10 interview in Newmarket, England. “You always have to go back there again. A handicap group one over two miles, there is no other race in the world with those specifications.”

While the 3,200-meter (2-mile) race, for which Melbournians get a public holiday, has been a constant highlight on the local sporting calendar, its impact historically was limited to Australia and neighboring New Zealand.

That changed 19 years ago, when Irish trainer Dermot Weld brought Vintage Crop to Melbourne and won the Cup. Weld repeated the feat in 2002 with Media Puzzle, and Japanese and French- trained horses have won in 2006, 2010 and last year.

‘Floodgates Open’

“Once somebody shows it can be done, the floodgates open,” said Alastair Donald, managing director of the Newmarket-based International Racing Bureau Ltd. “It also has a reputation as being a fantastic event, therefore it sparked the interest of Europeans.”

During the 1970s, fewer than half a dozen thoroughbreds each year would cross continental boundaries. Now, more than 400 horses undertake such trips, according to the bureau, which helps racing organizations in recruiting international runners.

The A$6 million prize money, accentuated by a local currency that almost doubled in the past decade against its U.S. equivalent, has also helped put the Melbourne Cup on the map. The A$3.6 million first prize is the most in Australian sports, while 10th place pays A$125,000, which can help mitigate travel budgets exceeding A$150,000.

Only the $10 million Dubai World Cup and $6.4 million Japan Cup have bigger prize purses.

Prize Money

“It’s very much on the radar of British, French and Irish trainers now,” said John Maxse, Sheikh Fahad’s spokesman. “People talk about the Melbourne Cup from the summer onwards. The higher prize money is a draw.”

Sponsors reflect the global appeal. Emirates Airlines has held naming rights to the race since 2004 and is also the VRC’s principle partner. Champagne maker G.H. Mumm, Swatch Group AG (UHR)’s Longines and Toyota Motor Corp. (7203)’s Lexus brands are among the 10 official partners of the four-day Melbourne Cup Carnival.

The 18-carat gold trophy visited Hong Kong in September as the VRC and Hong Kong Jockey Club announced an alliance that offers their members reciprocal privileges. Tomorrow’s race will be simulcast in Hong Kong, where locals wagered HK$20.6 million ($2.7 million) on it last year, according to the jockey club.

Similar arrangements are also in place in Canada, New Zealand, Singapore, South Africa and the U.S., the VRC said.

Having familiar names in the field is pulling more punters in the U.K., even though high street betting shops are closed at race time. William Hill Plc (WMH) and Ladbrokes Plc (LAD), who have more than 4,100 outlets between them, said betting turnover on the race will be up this year.

Interest Spikes

“We expect the Melbourne Cup this year to be record- breaking,” said Ladbrokes spokesman David Williams. “If home- based punters recognize the horses, they’ll have a bet. This hasn’t always been the case regarding the Melbourne Cup, but the success of big European bases recently has helped spike interest.”

Ladbrokes rates 2010 winner Americain as the 4-1 favorite ahead of Dunaden and Mount Athos, which is trained by U.K.-based Luca Cumani. William Hill has Americain and Mount Athos as the 11-2 joint-favorites with Maluckyday the best-rated local chance at 12-1.

Tabcorp, Australia’s largest racecourse betting company, rates Americain the 5-1 favorite to pull off another successful overseas raid, a trend that has encouraged locals to look north of the equator for potential winners.

“When it’s opened up to international competition, you get in the newspapers, you get on television and more interest,” the VRC’s Monteith said. “That’s what actually happened with us with the overseas horses in the first instance. Now you see Australian owners going overseas and purchasing internationally bred and raced horses specifically for the Melbourne Cup.”

To contact the reporter on this story: Dan Baynes in Sydney at dbaynes@bloomberg.net

To contact the editor responsible for this story: Christopher Elser at celser@bloomberg.net


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