LIC
18/12/2014 10:02
JOINTV
PRICE SENSITIVE
REL: 1002 HRS Livestock Improvement Corporation Limited (NS)
JOINTV: LIC: LIC announces joint venture with Brazilian distributor
Market Statement - 18 December 2014
LIC announces joint venture with Brazilian distributor
LIC has purchased the majority interest of its Brazilian genetics
distributor, NZ Brasil Genetics Producao Animal Ltda.
The joint venture (JV) includes exclusive supply of the farmer-owned
co-operative's dairy genetics for an initial period of 10 years, through a
new entity called LIC NZBrasil.
LIC chief executive Wayne McNee said the co-op began exporting genetics to
Brazil in 1999, but the new JV will seek to deliver a better return to farmer
shareholders in New Zealand.
"Brazil is the fifth largest dairy industry in the world, with more than 23
million dairy cows. Huge growth is expected over the next 10 years and this
presents a significant opportunity for LIC, and our shareholders.
"Our objective with the joint venture is to support the growth of Brazilian
dairy industry, providing high quality genetics solutions to build a
sustainable business that will generate a better return for LIC in New
Zealand."
Brazilian cow numbers are forecast to increase to 25 million by 2020, and
annual production to surpass 38 billion litres.
While the use of artificial insemination is low, around 20 per cent of cows,
it is growing, with the number of inseminations doubling since 2008.
Demand for pasture-based genetics and the progeny it delivers is also on the
rise, reflecting a growing belief in the value of genetic improvement to
drive productivity gains.
McNee says the JV supports LIC's goal to be $1billion revenue co-operative by
2025.
"To achieve this goal, LIC needs to grow in New Zealand and overseas. As part
of this we have been working to identify key markets and businesses that
align with our growth aspirations and fit with our co-op focus.
"We have identified the Brazil as a key international market that will add
value for our shareholders."
Other key international markets in the co-op's sights include the United
Kingdom, Ireland and China.
ENDS
Contacts:
Media: Ashleigh Sattler, Senior Communications Advisor - [email protected]
or 027 617 1942
Investors: Gillian Brennan, Company Secretary - [email protected] or 027 295
5215.
End CA:00259080 For:LIC Type:JOINTV Time:2014-12-18 10:02:13
(20min delay)