" STALLION SYNDICATION: AN APPRAISAL
" To syndicate or not to syndicate? That is the question faced by many owners whose good race horse is ready to be retired to stud. It is also a question that must be answered by many breeders whose young stallion’ s early get begin to run well. 6
" The popularity of stallion syndication cannot be denied. A heavy majority of leading sires are owned by syndicates, along with many of the top young stallion prospects. And the proportion of syndicated stud horses seems to be increasing every year.
" This form of stallion ownership, as its developers and advocates are quick to point out, offers definite advantages to members of the syndicate, sometimes to the stud manager, and in certain cases to the horse himself.
" But a growing number of horsemen are having second thoughts and reservations about the syndicate system. Some regard it as a necessary evil under modern breeding conditions; still others believe that, at least in certain aspects, it is detrimental to the breeding industry in general, and even to the future development of the breed.
" In an effort to arrive at some basis for evaluation of this issue, it is attempted here to set down something of the history and development of stallion syndication, along with the comments, be they pro or con, of many qualified horsemen with whom the matter has been discussed.
" An effort was made to achieve a representative survey of opinion, and a balance between those favoring and those opposing syndication. It was soon discovered, however, that, while few horsemen are ' dead set " agin " it,’ few, even among syndicate members and some syndicate organizers, fail to detect certain faults and dangers in the system. Therefore, there may be a slightly disproportionate emphasis on the negative side in this report.
" It was also found that a surprising number of horsemen, normally a highly articulate group with definite opinions, were reluctant to discuss the matter publicly and declined to be quoted directly by name. Therefore, several of the comments in this report must be anonymous or paraphrased. " First, though, let’ s fill in the background of the subject. " Broadly speaking, there are two types of stallions, depending upon the circumstances and conditions under which they stand.
" First, there is the public stallion, whose services are available to any breeder with a mare and the
stud fee. " Of course, as the breeding industry has developed,
some of the better sire prospects and more successful stallions have had their books limited to a reasonable number of mares. Sometimes the stallion’ s manager reserves the right to approve any mares bred to the
horse, in order to improve the quality of his mates
and hence, it is hoped, of his get. " The public stallion is still the most common type. " Second, there is the private stallion, bred only to his owner’ s mares or to those of other private-stallion
owners with whom stud seasons may be exchange. " It obviously requires a large broodmare band to fill a private stallion’ s book, plus an inordinate degree of faith in him to base a total breeding program on one horse’ s unforseeable stud prowess. Changes m
January, 1968 tax structures, the decline of large independent fortunes, and the general increase in the cost of thoroughbred mares and other breeding expenses have drastically reduced the number of breeders rich enough to afford to maintain a private stallion.
" Today this type of stud horse has virtually disappeared, save for a very few great sires who, because of age, serve only a few mares each year. Bull Lea’ s later stud career is an example. " The syndicated horse falls somewhere between the public and the private stallion, and represents an attempt to evolve a system of stallion handling suitable to modern financial and breeding conditions.
" Syndicate, according to the dictionary, is ' an association of persons who combine to carry out a financial or industrial project.’
" And a stallion syndicate, simply defined, is an association of persons who combine to purchase, own and stand a stallion, often though not invariably under professional management.
" While stallion syndication in its modern sense is by and large a post-war arrival, group ownership of a horse is nothing new.
" The first instance of the application of the term ' syndicate’ in breeding literature, so far as can be determined, occurred in connection with the 1913 dispersal of the Castleton Stud stock for the James R. Keene Estate.
" Some question exists as to whether early stallionowning groups, such as those that handled SWEEP, SIR GALLAHAD III and BLENHEIM II, were actually syndicates in the true and modern sense of the term, or simply associations of multiple partners. This doubt explains the previous use in this report of quotation marks in referring to such groups as ' syndicates.’
" There is really no clear-cut and generally accepted distinction between partnerships and syndicates.
" Indeed, there is nothing to keep two people who own a stallion from calling themselves a ' syndicate.’ BIMELECH, belonging to a three-way partnership between Greentree Stud, King Ranch and Ogden Phipps, is sometimes listed as the property of a syndicate.
" The chief distinction between partnerships and syndicates is the number of members. Generally partnerships consist of two, three or four members; but syndicates may have twenty, thirty, thirty-five or more members.
" Since the membership complement of both partnerships and syndicates may vary so widely, though, this is not an entirely reliable distinction.
" Some horsemen attempt to distinguish between the two types of group stallion ownership through the terminology used to describe the organization.
" In a partnership, each member has a fractionally specified interest in the horse- a half, third, quarter, fifth, eighth or what have you. Sometimes one partner may have a larger interest than others, of course.
" But in a syndicate, at least in the modern version of that term, each member’ s interest is specified by the number of shares he holds in the organization. Each share normally carries with it the right to send one mare to the stallion each breeding season. Some members naturally may hold several shares apiece, while at the opposite end of the scale some syndicates include holders of half-shares which presumably indicate that they can breed to the horse only in alternate seasons.
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