Genetics Australia will enter into a new joint venture with global herd improvement leader URUS from July 1.
The new entity will continue to trade as Genetics Australia.
URUS is based in the United States and is a global leader in products and services for dairy and beef producers for artificial insemination, genetics, reproduction, and farm management systems, servicing more than 80 countries with brands such as GENEX, Alta Genetics, PEAK, VAS and Trans Ova among many others.
The joint venture will be 60 per cent owned by URUS and 40 per cent owned by GA.
It will have access to the full suite of GENEX products and access to the PEAK program.
Current GA chief executive officer Anthony Shelly will manage the joint venture.
The joint venture is subject to approval from GA members with a postal vote starting from April 3.
GA will hold meetings in coming weeks and provide other opportunities for members to ask questions and provide feedback.
Genetics Australia chair Trevor Henry said the joint venture would usher in an exciting new era in Australian herd improvement.
“Combining with URUS will provide Australian dairy and beef producers with access to market leading global genetics, technology and advice that simply could not be achieved by GA on its own; and GA will now have access to global markets for its Australian bred and sourced bull line-up,” Mr Henry said.
“This will assist in marketing Australian genetics to a global audience.”
Mr Henry said the GA board strongly recommended the transaction to members.
“We believe it provides the business with long-term sustainability and access to the best products and services in the world and will enable us to support the development and growth of our staff,” he said.
Mr Henry said GA had a strong position in the Australian market and was entering the joint venture from a position of strength, but the market was becoming increasingly impacted by global trends that it had limited resources to pursue.
“Partnering with one of the large multinational market participants is key to establishing GA as a long-term sustainable locally-based genetics provider to Australian farmers,” Mr Henry said.
“This is genuinely a win-win and importantly there will be no change to the employees that customers work with, or the brands they see in the market which will remain as Genetics Australia and TLG.”
Mr Shelly said the joint venture would benefit members, clients and staff and was a perfect fit for the co-operative.
“All of our negotiations with URUS have focused on how the JV partnership can deliver enhanced products and services to GA’s members and the broader market in Australia,” Mr Shelly said.
Mr Shelly said customers wouldn’t notice any major changes in the months ahead but over time would see an increased depth of products and more opportunities and support for international clients seeking Australian genetics.
URUS has undertaken similar transactions over recent years and chief executive officer Paul Hunt said Australia was an important market for the business.
“We have had experience here for many years and have looked at ways in which to further commit to the market,” Mr Hunt said.
“When GA approached us about a partnership, we quickly determined this to be a fantastic opportunity that needed exploration.
“We firmly believe that we produce the world’s leading genetics for the cattle industry and that this can have a significant positive impact for Australian farmers.
“Our PEAK division, which produces over 10,000 calves annually and supplies the highest quality genetic material to our business and will do so for the proposed JV going forward. When this is combined with the products sourced by GENEX, we feel that we will quickly be in a position to strongly support Australian farmers.”