Zayat files for bankruptcy; Monday’s bank hearing likely postponed

Ahmed Zayat, the top Thoroughbred racehorse owner in North America just two years ago, filed for bankruptcy in Newark, N.J., on Wednesday to block a possible bank takeover of his racing stable.

The bankruptcy comes less than a week before a hearing in U.S. District Court in Lexington on a motion by Fifth Third Bank to appoint a receiver for Zayat’s 200-plus horse racing stable. Fifth Third alleges Zayat owes them more than $34 million after defaulting on a loan.

Because a bankruptcy filing stays all other pending litigation, Monday’s hearing on the bank’s motion likely will be cancelled.

Zayat said that he “intends to quickly file a plan of reorganization that will pay claims of creditors over a reasonable period of time as it continues to execute on its sound business plans that have thus far produced stellar racing results and, based on prior performance, will continue to do so.”

Last year, Zayat’s homebred Pioneerof the Nile finished second in the Kentucky Derby. Zayat finished 2009 as the third leading owner, with more than $6.3 million earnings. He has two hopefuls for this year’s Derby, Eskendereya and Macias.
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