Racing's new power

Australia's horse racing industry is about to change forever.

Bob Ingham, head of the Ingham family's $900 million chicken and thoroughbred empire, yesterday announced the sale of the family's Woodland Stud breeding and racing operation to global thoroughbred giant Darley, owned by His Highness Sheikh Mohammed bin Rashid Al Maktoum, ruler of Dubai.

Ingham says he had not been considering selling Woodland until approached by Darley in the last few months. The offer from Sheikh Mohammed – who is the biggest owner of race horses in the world – was simply too good to refuse. He says the deal will be on a "walk-in, walk-out” basis; Woodland's staff and management will remain in place. The deal is subject to approval from the Foreign Investment Review Board.

While the price paid by Sheikh Mohammed has not been disclosed, industry sources put the sale at a tick over $400 million. Whatever the actual number, the deal is without doubt the biggest in the history of the Australian thoroughbred industry. It is also proof that the horse racing is much more than a rich man's indulgence.

Bob Ingham and his late brother Jack inherited a small chicken farm when their father died in 1953. They turned that farm into the nation's dominant chicken business, with more than 7000 employees and annual revenue of more than $1.5 billion.

That part of the Ingham's empire is well known. But the brothers also inherited a broodmare called Valiant Rose. From this single horse they built Australia's largest racing and breeding operation, with six breeding and training facilities, around 1000 horses (including about 400 horses in training) and a staff of 230. Woodland is home to some of Australia's best stallions, including the Ingham's greatest horse Octagonal, who won $5.9 million and stands at stud with a service fee of $30,000 – a handy little annuity stream, given he can serve up to 130 mares per year. Prizemoney earned by Woodland's runners – who race in the all-cerise colours known to punters across Australia – regularly tops $10 million. This is a serious business.

Woodland's new owner is serious about racing too. Darley has breeding and racing operations across Europe, the United States, Japan and Australia. Sheikh Mohammed's associated stable, Godolphin, is one of the world's most successful. Annual prizemoney earned by its runners – who race in all-blue colours – regularly exceeds $20 million.

That Sheikh Mohammed was prepared to pay a big price for Woodland Stud will surprise no-one in the thoroughbred industry. Darley has invested billions in its operations over three decades and is always prepared to pay top dollar for the best horses. A great little anecdote in the latest edition of the Racehorses Annual published by British company Timeform this month reveals how Sheikh Mohammed was prepared to pay $US60 million last year for one particularly well-bred young horse.

Already there is some murmuring in racing circles about how Sheikh Mohammed could come to dominate Australia's racing scene. Darley established a breeding operation in Australia in 2001 and employs 100 people across two stud farms in the Hunter Valley and regional Victoria. When Darley's existing operations are combined with Woodland's breeding business and extensive roster of race horses, Sheikh Mohammed will have an exceptionally strong hand. The extraordinarily professional way he runs his racing and breeding empire will no doubt shock those sections of the Australian thoroughbred sector that continue to operate like a cottage industry.

But Australian racing should not fear the Sheikh's dominance. Horses are fickle beasts. Some get injured or ill and others just don't run as fast as their breeding might indicate. While Sheikh Mohammed will undoubtedly win a lot of races in Australia, his money is no guarantee of success.

The great Australian racing tradition of egalitarianism – the idea that a bush owner can beat a rich business person like Bob Ingham – will not die with this deal.