Vinery and Kia Ora combine operations in 'natural evolution'

Separated by the Pages River, Kia Ora and Vinery studs boast some of the Hunter Valley’s most valuable land. On either side sits prime and fertile country, each with its own successful history of raising elite horses. Each is host to an impressive stallion roster, and the extensive teams that go with managing high quality and commercial bloodstock operations across thousands of acres.

The exciting merger means that Kia Ora’s Malaysian-born owner Ananda Krishnan will become a seventh partner in Vinery, joining a party which includes Gerry Harvey, Neil Werrett, Alan Green, David Paradice and Greg Perry.

Another existing shareholder in Vinery, Steve McCann, recently took over the Chairmanship of Kia Ora, and told TDN AusNZ how the merger came about.

“The Vinery partnership has been together for almost 20 years now, and I’ve been a partner from the start,” he said. “We’ve always bred and owned horses with Kia Ora over that whole period, so it was a natural evolution. Looking at those two properties alongside each other, it’s pretty compelling to see how we can put them together in some way.”

With an eye on providing unrivalled access to such excellent property to their existing customers, McCann explained that the pooling of capital, resources and expertise means a joint venture will open up opportunities that weren’t available before.

“We’ve got our own strategy, and we’re working through how we’re going to make sure that is optimised going forward. But there’s areas where there’s pretty clear overlap.

“The additional capacity of the farms working together is one, the capital is another, things like acquisitions of bloodstock, yearling preparations and horse management are some areas where we feel we can add value by working together.

“It clearly does put us in a pretty strong position competitively, but it’s not about trying to compete with anyone else. We’ve got our own view as to how we want to grow and we’re very active at the moment investing quite a bit of capital between both businesses, and that’ll continue.”

Inward focus

Vinery’s General Manager Peter Orton agreed that the merger hasn’t arrived as a response to the outward pressure of competition, but rather from the respective team’s focus on achieving their own aims.

“It’s not a case of taking on or copying anyone else,” Orton told TDN AusNZ. “This whole industry is about available opportunity. You can have money, but if you don’t get opportunity, you don’t move forward.

“Having the level of bloodstock that’s within the two operations, the level of people that are involved and the standard of the country - if you want to tick every box as far as operating in this industry these properties do it and some more.

“The exciting part of it is that we can continue to do what we’re doing and almost triple our opportunity going forward by working together and grow our businesses in the way we want to grow them.”

Growth might seem a scary thought when you consider how successful each party has been in their own right. Between the two studs, they are responsible for a host of Australia’s elite horses, more recently including Champion 2-Year-Old and G1 Golden Slipper winner Farnan, Champion First Season Sire Russian Revolution and Group 1 winners Wild Ruler and Loving Gaby (I Am Invincible).

At last week's Magic Millions Gold Coast Yearling Sale, Kia Ora sold seven yearlings for an aggregate of $2,425,000 and an average of $346,429, while as buyers, in conjunction with a number of different players, including Ciaron Maher Bloodstock and TFI Bloodstock, they parted with a total of $7.65 million. Those purchases were headlined by Lot 955, an Exceed And Excel colt out of Ichihara (General Nediym) from the Corumbene-bred family of this season's G3 Breeders' Plate winner Empire Of Japan (Snitzel).

Meanwhile, Vinery Stud sold 18 yearlings for total receipts of $5,980,000 and concluded with an average of $332,222, headed by a filly by Too Darn Hot (GB) which they sold to McKeever Bloodstock, Watership Down, Gai Waterhouse and Adrian Bott Racing for a cool $1 million.

Gallery: Some of the elite horses that have come from Vinery and Kia Ora in recent years

But, with his involvement in both businesses, McCann echoed Orton’s sentiment and added that for the many stakeholders involved the driving force for the new deal came from their shared passion for the sport.

“All the partners at Vinery and also Ananda Krishnan at Kia Ora love breeding and racing horses,” McCann said. “When you’ve got a stallion station you try to make sure that you’re accessing the very best quality opportunities there.

“To make the best stallions you also have to have the best broodmares going to them, and we’ve got a combined strength on the broodmare side that’s fantastic.

“With this, there’s some real leverage opportunities once we put our heads together and work alongside each other to try to maximise those.”

Practicalities

Exact details of the new structure are still being finalised but, whilst McCann and Orton are excited about what the future holds, for now there won’t be too many discernible changes to the structure of either entity.

For instance, whilst Vinery has a significant agistment business alongside its other activities, Kia Ora does not - and that will stay the same.

Watch: Kia Ora's recently expanded stallion facility

Kia Ora’s recently expanded stallion facility - containing exciting young sires Prague, Farnan and Captivant - will remain entirely separate from Vinery’s more established roster, which includes Ole Kirk, Star Turn, All Too Hard and Exceedance.

“There will be no change to the existing operational structure,” McCann explained. “As for the bloodstock ownership, individual partners have interests in a lot of broodmares and racehorses, and that will stay the same as well.

“But, going forward there will be a collaboration agreement through which we establish how we approach stallions and where we’re going to stand them.”

Nor too will the merger mean any change up in either team. As Orton explained, the opportunities the merger brings will arrive in due course, but until that growth comes each side will continue to rely on their existing teams.

“Basically, we’re looking at the two operations keeping up the same day-to-day work, it’ll be business as usual,” he said. “The only changes you’ll see are in the future when we grow the business as we stretch out into other areas.

“The people we’ve got involved in every facet are excellent, so there’s no need to disrupt that at all.

“It will certainly increase the opportunity to source more, with the level of broodmares around. But, it doesn’t change a lot of the practicalities. We still need the same personnel and we’ll probably have the same amount of horses.”

Vision

Returning to the question of why two of the country’s most successful farms would choose to form a partnership, McCann described it as an opportunity that’s long been in consideration.

As he would argue, in the sense that the independent success of each business has its foundation in teamwork and partnerships, the merger is simply a logical progression.

“We discussed whether to do this with the partners over a period of time,” he said. “We made the decision that it’s the right thing for the business, it’s a pretty exciting opportunity to pool the capital of both businesses, and the resources we have and the expertise.”

“It brings together two of the very best bloodstock properties in the country, so that’s always been attractive and it’s been something we’ve thought about for some time.”