Chairman of The Thoroughbred Horseracing Trust Mark Currie has urged all stakeholders to disregard the ‘noise’ around Kenilworth Racing and support the process of placing the region in the best possible hands to achieve a sustainable future.
In an open letter to stakeholders, Mr Currie writes that, whilst he is the Chair of the Thoroughbred Horseracing Trust and writes with the permission of his fellow Trustees, he expresses his personal thoughts on the open sessions held, the letter from the NHRA, as well as various commentaries doing the rounds.
Mark Currie – ‘let’s rally and find a solution’
- The ‘financial distress’ of Kenilworth Racing (KR)
The company is audited annually, and our auditors are required to review both the liquidity and solvency of Kenilworth Racing prior to releasing their audit report.
They therefore satisfy themselves that we are solvent (assets fairly valued exceed liabilities) and liquid (the company can meet its cash flow obligations for 6 months after the date of signing KR’s financial statements).
KR’s assets are worth significantly more than its liabilities which is principally its loan owing to RMB (guaranteed by MOD and Phumelela).
Liquidity has always been an issue for KR since before Phumelela went into business rescue and was supported through the Sustainability agreement, facilities from RMB, as well as short-term working capital provided byPhumelela.
When Phumelela went into business rescue, the directors (both Robert Bloomberg and I acted at that stage with Robert providing executive services to KR as well) sought alternate sources of funding, reaching out to numerous stakeholders for support.
MOD were the only organisation prepared to provide such liquidity, for which the directors and Trustees were grateful to Mrs Slack for her unwavering support. MOD have to date always provided assurances that have satisfied the directors that they have sufficient liquidity to meet the liquidity test required.
Wehann Smith made reference to a ‘liquidity crisis’ that took place after the Cape Summer Season. This was caused primarily by the Omicron virus which curtailed attendance and impacted significantly on both tote turnover and sponsorship.
Again, 4Racing stepped forward and assisted with this liquidity requirement. In exchange, both MOD and 4Racing requested that adequate security be provided for these loans. When it became clear that permission for such encumbrance was required from the WCGRB, both MOD and 4 Racing still provided guarantees and liquidity for KR to continue operating.
The notion that 4Racing or MOD were trying to ‘steal’ KR’s assets is absurd as a simple repayment of the loans provided will release any security that the WCGRB sanctions as appropriate for such loans.
- Purpose of Kenilworth Racing / Trust meeting
The purpose of the open meeting held at Kenilworth on 5 May was to inform Cape Stakeholders of the Trust’s intention to dispose of Kenilworth Racing, as well as to note the challenges that KR currently faces.
The sale process will not be a highest cash bid wins, but rather meeting the goals of the Trust and stakeholders of Cape Racing.
Broadly speaking, these would include, amongst others, property ownership, composition and size of stakes pot, strategy on dealing with current Cape stakeholders/customers (covering Grooms,
Trainers, Jockeys, Owners, Punters, Racegoers and Staff) as well as the mechanism for stakeholder engagement in the future.
The meeting got a little sidetracked and hopefully this clarifies our intention.
- Business Rescue
I hear many calls for Kenilworth Racing to be placed in Business Rescue.
Whilst not being totally au fait in the law of Business Rescue, I do know that this takes decisions around the company out of the hands of directors and shareholders and places it in the hands of a business rescue practitioner.
Absent of post commencement funding, the BRP would in all likelihood place the company in liquidation which would lead to a sale of KR properties to developers rather than a race course operator.
I fail to understand how this would benefit any Cape Racing stakeholders and for this reason, KR directors and Trustees have resisted placing KR in business rescue.
- MOD / 4 Racing
I am personally disappointed at the criticism being levelled at both 4Racing and MOD. We as the racing public have short memories, and I remind all critics that MOD was really the only entity that stepped forward and stabilized racing in SA.
Whilst people may see Charles Savage and his comments as arrogant, his points are extremely well made. 4 Racing has set out their strategy for the future of SA racing and we can agree or disagree with their stance.
To attempt to disparage them only creates doubt in other interested parties as to the true colours of Cape Racing stakeholders – do they seek an enduring solution to horseracing or do they look for a soapbox to air their personal grievances with the way they perceive they have been treated?
- Conclusion
Whilst I may be considered naïve, my call to interested stakeholders is to rally around and seek a solution for Cape Racing.
The Trustees, and particularly the Trustees dealing with the KR disposal, are independent and are committed to achieving an enduring solution for KR that will benefit all Cape stakeholders.
I urge you to disregard the noise around Kenilworth Racing and support the process of placing the reigion in the best possible hands to achieve a sustainable future.
- Ed – this letter is published unedited and as received from Mr Mark Currie
- Images are for illustration only
