The MRC parted ways with two CEOs in 12 months. It cost the club $2 million

Melbourne Racing Club forked out almost $2 million in severance payments to cut ties with its past two chief executive officers in a turbulent 12 months that saw former chairman John Kanga take over the board and the club’s debt blow out by $24 million.

A deed of release document seen by The Age shows that the MRC agreed to pay out former CEO Josh Blanksby $1.2 million before he ended his seven-year term in charge of the organisation in August last year.

His replacement, Tom Reilly, was sacked on the King’s Birthday weekend this year just three months after he moved his family to Melbourne from Sydney to take up the role.

Two sources linked to the MRC, commenting on the condition of anonymity, said the club paid Reilly more than $500,000 plus legal fees to prevent an unfair dismissal claim going before the courts.

Blanksby and Reilly both declined to comment when contacted by this masthead. The MRC said it does not comment on confidential matters involving current or former employees.

The Age reported last week that Kanga quit the racing club as chairman on the eve of its lucrative Caulfield Cup week carnival after questions about his car being used in a 22-kilogram cocaine trafficking case and new revelations about his past links to loan sharks.

The Age does not suggest Kanga was involved in any criminal activity, and he has never been accused of any crime.

The club’s recent annual report revealed the MRC lost $17.3 million over the past financial year, despite receiving $46 million profit from its 15 poker machine venues, which contributed to its debt ballooning from $154 million to $178 million.

The two sources said the club’s total staff settlement payments would have pushed beyond $3 million after six more senior executives departed the MRC’s Caulfield headquarters under Kanga’s 11-month reign.

The brain drain included the loss of two potential CEOs-in-waiting, former chief financial officer Brent Westerbeek and former head of legal risk and corporate affairs Damian Menz.

The sources said Blanksby, architect of the Caulfield Masterplan, decided to resign with one year remaining on his contract because close ally and chairman Matt Cain was retiring from the board, and that the remaining committee members had become split on what the future club’s strategy should be.

At stake was the future of Sandown Racecourse, which had been earmarked for rezoning and potential sale. The 112-hectare Springvale site was seen as a prime spot for a new housing development and has since been valued at more than $600 million.

Since Kanga joined the board in a casual vacancy in 2023, only one board member remains, treasurer Alison Saville, and only one senior executive from that time frame still reports to the MRC’s acting-CEO – Pegasus Leisure Group chief executive Russell Evans, who oversees the MRC’s lucrative poker machine venues.

Kanga’s Save Our MRC movement swept to power during last year’s spring carnival by declaring it would save racing at Sandown, end plans to build a new $230 million grand stand at Caulfield and decommission a $60 million mounting yard facility and move it back in front of the members’ area.

The Age reported last month that 24 memberships linked to Kanga and his family were purchased by a single credit card in the lead-up to the MRC’s bitter boardroom battle last year, when he seized control of the $1 billion sporting club. The MRC denied the block of memberships affected the outcome of the club’s September elections, and said they did not breach any rules.

Separate documents seen by The Age show that among the list of 170 signatures collected by Kanga to file a motion for a special general meeting to spill the board in August last year were the names of seven of his family members, two jockeys, two trainers, a jockey’s family members, three current board members and acting-CEO Tanya Fullarton.

Fullarton was vice chair of the Thoroughbred Racehorse Owners Association at the time and did not join the MRC as a staff member until the King’s Birthday weekend this year, when she was appointed chief operating officer.

Fullarton said her signature on the SGM motion reflected her personal support for preserving Sandown as a key racing asset.

“I one hundred per cent believed in the Save Sandown campaign,” Fullarton said. “At that time, my focus was on saving Sandown, returning the mounting yard to its rightful place, and preventing further wasteful spending on an unneeded and unwanted grandstand.

“There were no discussions or expectations of any future role at the club. My support for the SGM was entirely about protecting an important racing venue for participants, owners and members.”

Despite Kanga’s petition calling for an SGM attracting enough signatures, an MRC board source – commenting on the condition of anonymity – said it was ruled invalid because the changes it proposed were unconstitutional.

Kanga was also accused by the then-board in a letter to members of trying to take control of the club “outside the normal election process”.

The MRC said in a statement it remained in a strong financial position.

“Following an extensive period of reform, the club is operating with renewed financial discipline and strategic clarity,” new MRC chairman Cameron Fisher said.

“After members overwhelmingly rejected the previous committee’s Caulfield Masterplan, the current committee has restored stability, refocused investment on racing and members, and set the MRC on a trajectory to become debt-free once the land sale to Mount Scopus College is completed.”

The club expects to clear its debt if Mount Scopus College exercises an option to buy 7.5 hectares of land beside Caulfield Racecourse for $195 million.

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