Irish-based Coolmore has a tentative agreement to purchase Kentucky Derby (gr. I) winner Fusaichi Pegasus for stud duty, beginning in 2001. The deal, according to Coolmore spokesman Richard Henry, was signed on Friday evening, one day after the passing of a deadline for bids imposed by the colt's majority owner, Fusao Sekiguchi, who designed a formal bidding process for the Derby winner's stallion career.
Sekiguchi's daughter-in-law Yukari Sekiguchi, along with Hawaii-based attorney Jim Clay, and Sekiguchi's business manager Takahiro Suzuki, were in Kentucky in recent days meeting with a number of bidders. Henry would not disclose the terms of the agreement, other than to say it was a record price for a stallion prospect and that Fusaichi Pegasus would enter stud at Coolmore's Kentucky farm, Ashford Stud. It is anticipated the horse would serve dual hemisphere seasons at Coolmore's operation in Australia's Hunter Valley.
The previous record price for a stallion prospect was $40 million for Shareef Dancer, who was syndicated in 1983. Sources have said the winning bid for Fusaichi Pegasus was upwards of $70 million.
Sekiguchi paid $4 million for the son of Mr. Prospector—Angel Fever, by Danzig, at the 1998 Keeneland July yearling sale. Coolmore and Padua Stable were underbidders on the colt at the sale. According to some individuals involved in the negotiations, one or more members of the Yoshida family, owners of Shadai Farm, may have purchased a minority interest in Fusaichi Pegasus since last year. Shadai was thought to be one of many interested bidders in the colt, along with just about every major international bloodstock player, from the Maktoum family of Dubai, to John Messara of Australia's Arrowfield Stud, to North American farms Lane's End, Darby Dan, Three Chimneys, Pin Oak, WinStar, Stonerside, Overbrook, Stone, and Taylor Made, among others.
To justify a purchase price of $70 million, Coolmore might have to begin with a stud fee of up to $200,000 live foal, which would generate as much as $20 million per year if Fusaichi Pegasus produces 100 foals annually. An Australian stud fee of AUS$100,000 (roughly US$60,000) could generate another $6 million per year, which projects to a maximum of $78 million over three years. A fee of $200,000 would be the highest first-year stud fee since Conquistador Cielo's $182,000 fee in 1983.