Australia's largest genetics supplier, Genetics Australia Co-operative (GA), is strengthening its position in the herd improvement industry with the acquisition of Total Livestock Genetics (TLG).
Genetics Australia will take over the TLG trading name from January 4 and GA's bull management, semen management and semen collection and production services will be transferred to the TLG site in Camperdown, Victoria.
Two of TLG's services, equine and live cattle export, will remain with the current owners.
The $5.8 million purchase will create efficiencies in the semen production system that will reduce GA's cost of production per year, allowing the co-operative to substantially build its business turnover.
Genetics Australia CEO Anthony Shelly said the purchase was a good strategic fit and would provide a platform for sustainability and growth.
"It is one of our key strategies, providing capabilities to continue with Australian breeding and Australian semen production while adding products and revenue opportunities and boosting our service capability," Mr Shelly said.
GA will continue to market products nationally and internationally under its own name while TLG's portfolio of genetic products will stay within the new Total Livestock Genetics Victoria (TLGV) entity as a separate channel of products.
The TLG acquisition will provide a platform for potential new international and domestic alliances and partnerships, create easier access to sexed semen services, and add space for expanding bull numbers.
The new TLGV owned by GA will employ existing TLG staff; however, a number of GA staff will be offered redundancies as part of the changes.
Mr Shelly said the GA Board wanted to ensure the cooperative continued to have the capacity to breed animals, produce semen and deliver genetics to members.
"I approached TLG about opportunities and the timing lined up," he said. "One of our strategic intents was to manage in excess of a million units of semen per year and this purchase will give us that capacity."
Genetics Australia will continue under its existing name. TLG will become the production facility for GA, with all bull and semen assets expected to be moved to Camperdown by the end of March.
GA's main facility at Bacchus Marsh will be sold during the next two years, although the cooperative will retain some office facility in the region.
Mr Shelly said Camperdown was in the heart of dairy, beef and sheep industries in western Victoria while the Bacchus Marsh accredited collection facility was landlocked and the region becoming impacted by urban sprawl.
"We wanted to move to a more rural area and one of the great assets of the TLG business are its properties at Camperdown and Glenormiston, which essentially have unlimited capacity for managing bulls for semen collection."
The move also gives GA access to key technologies such as IVF and easier access to services like sexed semen.
Chairman Trevor Henry said the purchase signalled a new chapter for GA.
"The Board and management team were challenged with the existing operations as it struggled to be efficient and profitable to allow for investment into the best products and services that we could offer to our members and customers," Mr Henry said.
"When the opportunity to acquire TLG presented itself, an exhaustive due diligence process was undertaken, and the benefits became clear. Another real consideration was the looming urbanisation of Parwan Park precinct and our medium to long-term ability to continue livestock production in that location.
"The Bacchus Marsh location has served us well for over 60 years and it will be a sad day for many when the 'Bullfarm' is no longer linked to the region, as it will be for the staff not going forward with the business. Many of these staff have played a vital role behind the scenes and we are indebted to their dedication and commitment and we thank them and wish them and their families well for their future endeavours."
Mr Henry said the acquisition ensured the ongoing relevance and success of GA in providing the best genetics to domestic and international markets.
"With the existing TLG service business, especially in toll collection of beef bulls and the recent work into ovine semen and embryos, we see an immense opportunity for GA to grow and offer our customers world's best products and services."
