His eureka momenAlthough John Magnier made his fortune breeding champion race horses, his shrewdness and toughness would have taken him to the top of any business. "The softest thing about Magnier," it is often said, "is his teeth." Nonetheless, Magnier's family background and racing connections stood him in good stead, says the Irish Independent. Born in 1948, the son of "well to do" farmers, he grew up near Fermoy in County Cork where his family had been breeding horses since the 1850s. His mother, Evie Stockwell, who ran the family stud after the death of Magnier's father, was a particularly formidable figure and a close friend of Ireland's most successful trainer, Vincent O'Brien. The connection between the families was cemented when Magnier married O'Brien's daughter, Susan.
Magnier's breakthrough was to realise that the "gentlemanly pursuit" of breeding and owning thoroughbreds could be "professionalised to generate whopping returns", says The Sunday Telegraph. "His eureka was to do it as a business, not a pastime." Certainly, conditions in Ireland in the early 1970s couldn't have been better: in 1969, finance minister Charles Haughey had pushed through legislation giving stud fees tax-free status. Magnier saw his chance, and went for it.
How he found the cash
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The catalyst that lifted the young Magnier into the big time was his friendship with Robert Sangster, heir to the Vernon football pools fortune. Then in his late 30s, Sangster was a loss-making hobby breeder who was so impressed with Magnier's acumen - as well as his first stud stallion, Green God - that he financed a partnership arrangement. Before long, the duo had recruited "training genius" Vincent O'Brien to the fold and, in 1975, they took over Coolmore Stud in County Tipperary. The business plan was based on Magnier's conviction that the big pay-off in racing no longer lay in prize money, but "in the breeding barn". "If you don't have the semen," he said, "you don't have the industry." Since the best bloodstock was to be found in America, they would buy up the best yearlings there, bring them to Ireland, race them, and develop them into prize stallions at a tax-free profit.
The bloodline that Magnier selected was that of Northern Dancer, an "explosively fast" stallion whose offspring were causing a sensation on US race tracks. But the partnership found it next to impossible to buy into his gene pool: "the Americans always outbid us", said Sangster. The solution they came up with was syndication: striking deals with rich US investors not only helped them raise bids, but also spread the risk. In their first year of operation, they raised some $4m to spend on stock, and in the second year $6m, says The New York Times. High profile investors included Frank Sinatra's manager, Danny Schwarz, but "there were few results". Magnier was learning that even with a Northern Dancer in his bloodline, every yearling is a longshot.
Striking gold
After a nail-biting two years, the partnership "struck gold" in 1977, says The Times. Between them, The Minstrel, Alleged, Artaius and Be My Guest secured all "the great races of Europe" - including the English and Irish Derbys and the Prix de L'Arc de Triomphe - and the profit-taking began. Magnier picked up his share of a cool $9m when the Minstrel (bought for $200,000 in 1975) was sold back to America for stud. But the real profits came from the stallions, like Alleged, says The New York Times. Before long, he was commanding some $80,000 for each mating, and covering a minimum 40 mares a year. Given that a horse can produce offspring well into his 20s, the partnership reckoned on making some $80m from Alleged's earnings alone - money that was swiftly channelled into more top prospects. By the 1980s, with a second generation of champions now storming through, it was clear that Magnier had "revolutionised the blood-stock industry", says The Sunday Times.
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