National Stud board takes slice of €3.6m

Several state-appointed board members responsible for running the Irish National Stud shared in the benefits of bloodstock investments that netted the company €3.6m last year.

At least one board member moved to significantly increase their interest in a lucrative Irish National Stud (INS)-controlled stallion.

This particular investment saw the highest individual stake, held by a director or the company secretary, rise from 15% to 26%.

The profits for individual board members have not been disclosed but the bulk of the shared income related to breeding prowess of the INS’s star sire, Invincible Spirit. He is owned by a syndicate controlled by the INS. However, its chairman, Chryss O’Reilly, and company secretary John McStay are also investors in him. Each shareholder is entitled to send their own mare to breed with the stallion or sell the option to other owners for up to €60,000 a time, based on 2011 prices.

Figures from the Weatherbys’ Return of Mares show that in 2011 Invincible Spirit covered 140 mares.

Three of these belonged to companies controlled by Ms O’Reilly and one was owned by Clodagh McStay, the wife of the company secretary.

A note in the INS’s annual accounts said unspecified directors and Mr McStay were part of syndicates that owned animals in partnership with the stud.

The company itself earned €3.6m from its stake in these syndicates, a 9% increase on the previous year.

The accounts said no individual director or the company secretary owned more than 26% each in any particular horse. In 2010 the highest stake stood at 15%.

The people involved in Invincible Spirit have been on the board since the early 1990s but have bought shares on a personal basis at various intervals since then.

In 2007, all Invincible Spirit shareholders benefited from a once-off bonanza when the ruler of Dubai, Sheikh Mohammed, bought a stake in the horse. At the time, the board members with shares shared a €2.9m windfall in a move that valued the stallion at €45m.

The 2011 accounts, filed with the Oireachtas, showed that Ms O’Reilly earned €12,600 in directors’ fees last year. Mr McStay’s position is an honorary one but his accountancy firm charged the INS €30,750 for support services in 2011, down €125,000 on the 2010 figure.

The annual accounts show that the stud did €5.1m worth of business, before the tourism trade was factored in. This was down from €5.5m in 2011.

In her annual statement Ms O’Reilly noted it had just six working stallions and needed to invest in a future beyond Invincible Spirit.

The accounts show its operating loss of €268,535 compared with €825,760 the previous year. This was turned into an overall profit because of an insurance payout over the death of one of its stallions, Verglas.

It was also given permission to borrow an additional €1.5m in 2010 to keep the business running.

The National Stud was contacted, but did not comment.

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