"my God, Are These People Spending Real Money?"

It will take a while for the world's thoroughbred industry to make sense—if, indeed, there's any to be made—out of the madness that occurred last week in the Keeneland sales pavilion in Lexington, Ky. In an incredible bidding war that took only eight giddy minutes, an Arab oil sheik bought an untested and unnamed yearling colt bred by a Kentucky coal-mine operator for $10.2 million, more than twice the previous world record of $4.25 million for a yearling. By paying that monumental sum, Sheik Mohammed bin Rashid al Maktoum, defense minister of the Persian Gulf state of Dubai, got the horse of his dreams, scored a macho victory over a big rival from Great Britain and raised all sorts of questions about what this sort of mega-spending means and where it all will end.

The colt, hip No. 308 in the Keeneland catalog, was among the last yearlings auctioned during the two-day sale, at which the biggest Kentucky horseflesh peddlers annually auction off the best sons and daughters of the best sires in the world. That No. 308 broke the record came as no surprise, considering that he was a beautifully constructed son of Northern Dancer, out of the mare My Bupers, who has produced a number of stakes winners. To the big bidders from Europe and the Middle East, the blood of Northern Dancer is immensely valuable because of the way his progeny have performed in the classic races of Europe. What was astounding, however, was the magnitude of the record. Only the most cockeyed optimists expected the colt to bring more than $5 million.

On the day of the historic sale, the colt's breeder, Donald Johnson, had stood outside Keeneland's Barn 16 and watched as one buyer after another came around to have a final look at the colt. Squinting into the sun, Johnson smiled and nodded at a sheik and his gaggle of advisers. Moments later, Johnson was chatting with a member of the British syndicate headed by soccer-pools baron Robert Sangster. And the silver-haired little man over there, wearing the gaudy Polynesian shirt? That was Stavros Niarchos, the Greek shipping magnate. "All the right people," said Johnson. The ones, in other words, who in recent years had bent the international yearling market out of shape with their desire to dominate the classic races of Europe.

Johnson, 49, was nervous. Far from being a member of the horsey Lexington aristocracy, he'd made his fortune as a coal-mine operator in the mountains of eastern Kentucky, deep in the heart of Appalachia. He has been in the horse business only since 1975, when he used some of the money he'd made in the coal boom of the early '70s to buy a few broodmares and 1,000 acres of scruffy land just outside Lexington. Using a bulldozer borrowed from his Crescent Coal Co., Johnson personally cleared the land and turned "an old pig farm," as he calls it, into the Crescent Farm, a suitable home for his broodmares and their offspring. Last week he had two colts at the Keeneland sale, one of the smallest consignments but one that hardly went unnoticed. As Johnson put it, "It doesn't make any difference who you are. If you have the horse, they'll buy it."

Because of shrewdness, or luck, or perhaps a little of both, Johnson in 1978 had bought a breeding share in Northern Dancer just before Sangster and the Arabs had begun to express, with their checkbooks, their passion for the offspring of the 1964 Kentucky Derby and Preakness winner. Johnson, who paid $125,000 for the share, sold it last year to a sheik for more than $600,000, as good a measure as any of how Northern Dancer's stock has risen. However, of the three Northern Dancer colts that Johnson got from his share, No. 308 was the first to get to the sale.

Two years ago Johnson had to remove his first Northern Dancer colt from the auction because it had developed a throat obstruction; last year, only six weeks before the sale, his second Northern Dancer colt died of an intestinal virus. The latter cost Johnson a small fortune, especially because the colt wasn't insured. That didn't shake Johnson's resolve—"If you can't afford to lose 'em you can't afford to have 'em," he says—but it did make him skittish enough that his wife, Linda, was able to persuade him to insure hip No. 308 for $1 million.

Privately, as time for the sale approached, Johnson was thinking that the colt might sell for $6 million, perhaps even $7 million. Later he would say, "If I could have written a script, it couldn't have gone any better for me." After all, the expensive Keeneland yearlings of the past few years had done extremely well over in Europe. Sangster, who operates the biggest soccer pool in Great Britain, came to Keeneland in 1975 and bought a son of Northern Dancer for $200,000. He turned out to be The Minstrel, winner of the Epsom Derby in 1977, and that set off the Northern Dancer boom.

Sangster's spending power went virtually unchallenged until 1981, when about half a dozen oil sheiks from various Arab states plunged into the yearling market. On June 25 this year Shareef Dancer, a son of Northern Dancer and a $3.3 million Keeneland purchase in 1981, won the Irish Sweeps Derby for Sheik Mohammed bin Rashid. A half-brother to hip No. 308, Lyphard's Special, won a big race in England on July 9. Finally, and most important, both the sheik and Sangster seemed to want No. 308, and when they go head-to-head, they create a market all their own.

The Arab contingent was led by the Maktoum brothers of Dubai—the Doobie Brothers, as the Kentucky breeders call them. In '81 Sheik Mohammed bin Rashid al Maktoum and Sangster locked checkbooks over a son of Northern Dancer that later would be named Ballydole. Sangster won the bidding, spending $3.5 million, then a record. Only moments after the bidding for Ballydole, Sheik Mohammed spent the $3.3 million for Shareef Dancer.

In 1982 at Keeneland, Sangster and Sheik Mohammed resumed their duel over a colt that would be named Empire Glory—a son of Nijinsky II and a grandson of Northern Dancer. "He sent a message to me," said the sheik, who bid $4 million for the yearling. Sheik Mohammed may have gotten the message, but once again Sangster got the horse, that time with a record bid of $4.25 million. And this year, on the opening day of the Keeneland sale, Sheik Mohammed also was underbidder to Sangster for hip No. 115, another son of Northern Dancer, at a record-tying $4.25 million. "It's reached a vendetta between them," an adviser to the Arabs told a reporter from the Lexington Herald-Leader.