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Newmarket based bloodstock investment boutique gallops to £2.7m of £4m target | Newmarket based bloodstock investment boutique gallops to £2.7m of £4m target |
| Written by Ben Fountain | |
| Thursday, 06 March 2008 | |
![]() On a roll: Breeding Capital's broodmare 'Exciting Times' Breeding Capital’s Placing has been well-backed by those who had a flutter on the original offering and the firm is now widening the field through an offer. £1.9m was raised through the placing to people who invested in the original Breeding Capital. A further £2.1 million was sought under the offer, with £800,000 of that target already secured. The minimum investment under the offer is £10,000. Breeding Capital is fronted by MD, William Sporborg – already well-known to the Cambridge business community through his tenure as a manager of the Cambridge Gateway Fund. Less well-known is the fact that Sporborg was a successful point-to-point jockey before retiring through injury in 1994 and remains a well known commentator on amateur racing. Breeding Capital was established to acquire a portfolio of bloodstock assets, consisting of broodmares, foals and yearlings acquired for resale and other related bloodstock assets. The aim of Breeding Capital, according to Sporborg, is to “give access to an alternative asset class with strong barriers to entry and deliver attractive risk adjusted returns to shareholders over the medium term.” Sporborg said: “We are delighted with the support of our loyal investors. Almost all of the larger investors in the original Breeding Capital have invested in the placing, with their average investment increasing by 34 per cent, which shows enormous confidence in the proposition.” Well-placed confidence, based on the performance of the original Breeding Capital fund, launched in 2006. Its bloodstock portfolio produced an internal rate of return (IRR) of 43 per cent, with 2007 bloodstock sales grossing more than double its initial cost less than 12 months earlier. Making the fund even more attractive is the fact that it is eligible for significant tax relief under the terms of the Enterprise Investment Scheme. Chief among Breeding Capital’s successes thus far was Madura – bought for 170,000 guineas in November 2006 and sold for 710,000 guineas 12 months later; and Leto – purchased for 250,000 guineas in November 2006, with a 50 per cent interest sold for 450,000 guineas late in 2007. In North America and the European Union alone, bloodstock sales at public auction grossed in excess of $2bn in 2007. The market in the UK and Ireland has strengthened over the last 10 years, with the average selling price of yearlings, the number of yearlings sold and the aggregate sales value all increasing significantly. Breeding Capital has assembled a formidable team to capitalise on the growing opportunity, including chairman, Christopher Holdsworth Hunt, co-founder and previous managing director of KBC Peel Hunt; and Simon Marsh co–founder of one of the most influential studs in Europe, Watership Down. Consultants to the firm are Charlie Gordon-Watson, agent on the acquisition of eight Classic winners and Michael Youngs, a pedigree and matings expert who has worked for Prince Khaled Abdullah. Bloodstock director, Marsh said: “We have now been working together for over 13 years and Breeding Capital’s success augments our track record in developing Watership Down into one of the most influential studs in Europe. “We believe that there will be strong market opportunities in the bloodstock world over the next few years, which we intend to exploit.” The aim is to provide an exit for investors by 2012, either through a listing, a sale or by way of a return of cash.
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