Silent Heir's first foal, Young Pretender, wins a Group Three at Longchamp, September 2007 - photo by racingfotos.com

The Indian Ridge filly, who we bought as a foal in 2006 for 120,000 guineas, was sold ten months later for 230,000 guineas

Portfolio of Assets

Please feel free to browse through, but certain information is only available to Investors. If you are NOT an investor, but would like to access the restricted information, please contact us to register your interest in Breeding Capital and gain access to the full portfolio.

Breeding Capital has acquired a portfolio of bloodstock assets, comprising broodmares, foals and yearlings available for resale as yearlings and two year olds respectively. The portfolio includes:

Broodmares

The majority of the funds raised have been used to acquire high quality, young broodmares which will be covered every year by quality stallions. The young stock will be nurtured at studs with a proven track record prior to being consigned to the sales as foals or yearlings. The principal income for Breeding Capital will be derived from the sale of such offspring.

For details on how Breeding Capital is participating in this marketplace, click here. Access is for investors only - if you are not an investor, but wish to know more about Breeding Capital, contact us.

Yearlings acquired for resale as two year olds

Yearlings acquired for resale as two year olds is a growing segment of the market. The sales are often referred to as "breeze ups" because the offered lots canter/gallop before the sale, so prospective vendors have the opportunity to see the two year olds in action before purchasing.

The suppliers of product to the two year old sales are becoming increasingly specialist, and are hybrids between stud farms and racing yards. They need to nurture the young horse, break them in, and train the horses so that they can breeze efficiently. Most suppliers act as both principal and agent - they will trade horses on their own account, or provide services in return for a daily keep charge and a commission on sale.

The breeze up market has been well established in the United States for many years. However, 28th February 2006 saw a fundamental change to the structure of the market, when Coolmore paid a world record price of US$16 million for an unraced horse when the subsequently named The Green Monkey was sold at Calder.

The breeze up market has grown significantly in the UK over the last five years, in terms of average selling value and the highest prices achieved. In 2001, Tattersalls sold 149 two year olds, at an average of 21,000 guineas, and a top price of 82,000 guineas. By 2006, the average had risen to 68,000 guineas, with a top price of 625,000 guineas. The multiples are not dissimilar at Doncaster, although the average selling prices are more modest - the average in 2006 was 23,000 guineas.

As demand for the breeze ups have increased, the Sales companies have tried to find ways to satisfy that demand, by putting on two additional breeze up sales in 2007. Goffs held a sale at Kempton Park, in March where the two year olds will gallop on the newly laid Polytrack before being sold; Tattersalls staged a second breeze up sale in May, just before the Guineas meeting.

Unfortunately, the breeze up market in the UK softened significantly in 2007. Although reported averages held up, clearance rates fell considerably, and the return on investment was well down on previous years. This has principally been blamed on increasing supply but static or falling demand.

Foals acquired for resale

Breeding Capital has acquired young stock, purchased for resale, often called pinhooking. Pinhooking involves the purchase of either foals or yearlings, for subsequent resale, either as yearlings or two year olds.

Stallion shares

Breeding Capital will also trade in stallion shares. A stallion share entitles the bearer to utilise the services of the stallion to which the share relates, or to sell the benefit of those services, called a nomination. The value of a share reflects the likely future income streams, so it is valued by reference to the age and perceived future desirability of the relevant stallion.

The Management Team has a strong track record in all of the segments referred to above, and believes the trading of such assets will both diversify Breeding Capital's portfolio and increase returns to investors.

Further funds for acquisition

The Company has further funds available to supplement its existing asset classes or to acquire other bloodstock related assets, such as fillies out of training for sale as in foal mares and racehorses for sale abroad, when the Directors believe that trading such assets will be accretive to Shareholder value.

For further details, contact us.