Phumelela to maintain stakes at current levels until February
DURBAN - Phumelela advises that in the light of the Racing Association’s decision to discontinue its contribution to stakes, which has been in place for the past five months , stakes will nevertheless continue to be paid at current levels in its regions during December, January and February.
In addition, there will be a small uplift to the minor race stakes in the Eastern Cape.
In addition to the difficult economic conditions in South Africa and the continuing impact of lock-down restrictions on both local and international markets, Phumelela continues to operate its horseracing and betting operations while under the constraints of business rescue.
However, in order to assist with the sustainability of the industry while the new racing operator obtains the necessary regulatory approvals, Phumelela has agreed to absorb the 20% contribution to stakes recently funded by the Racing Association.
This will enable stakes to be maintained at current levels to end February, by when regulatory approvals should have been received.
It is a challenging environment for businesses to commit to sponsorship, however any race sponsorship income sourced by Phumelela will be used to bolster stakes further.
This has already happened with the Gauteng Summer Cup (Gr 1), where World Sports Betting’s generous sponsorship has helped to increase the stake of the race to R1 million.
Phumelela’s Business Rescue Practitioner continues to consider all aspects of the Company’s business model to ensure the continuity of operations until all requirements for finalisation of the transaction are met.
This includes re-considering the funding model of the sport with the intention to increase stakes but reduce the unequal subsidies given to different owners and trainers as relates to horse transportation, training facilities, grooms’ accommodation and stabling.
The aim being to find the most appropriate method of encouraging and rewarding participation in the sport by more owners with more horses.