Stone Axe Pastoral Company, an Australian enterprise located in Kojonup that is aiming to establish a large scale, vertically integrated full-blood Wagyu beef supply chain, has acquired a 50 percent stake in the Yarranbrook Feedlot in Queensland from the John Dee Group for an undisclosed sum.
Under the terms of the deal, Stone Axe and John Dee will form a 50:50 joint venture geared toward continuing the feedlot’s operations in connection with the cattle owned by the two partners, as well as providing custom services to third party customers.
The yard is owned and has been operated by the Hart family for 30 years, who also operate the John Dee export beef processing plant near Warwick. With an operating capacity of 20,000 head, the yard is licensed to feed up to 25,000 head given future development. It produces grain fed cattle, mostly over 100 to 150 days for the John Dee Silver and Gold grainfed brands, and engages in custom feeding services from domestic to Wagyu export weights for client businesses.
“The Hart family and the John Dee team have been operating the Yarranbrook feedlot for more than 30 years, and their abattoir for 75 years, and have a great production system feeding and processing high-value cattle especially long fed,” said Scott Richardson, managing director of Stone Axe Pastoral.
“John Dee has an outstanding reputation in key export and domestic markets which was a critical part of Stone Axe’s investment decision to complete its East Coast supply chain integration.”
Founded in 2014 by Cicero Group founders, Matthew Walker and James Robinson, Stone Axe Pastoral is targeting a plan that calls for the building of a full-blood Wagyu breeding herd.
Beginning in September of last year, 400 wagyu embryos were implanted in Angus and Angus-cross breeders, reports The West, and the company has 2,500 embryos stockpiled at the Holbrook breeding center in New South Wales.
“A cow can produce about 20 embryos per month,” Walker told Farm Weekly in 2017. “We are in a hurry to ramp up our numbers. We intend to intensify our model to about 5,000 transfers a year when we crank up – globally no one is doing this.”
That same year Roc Partners, a leading alternative investment manager that was created following the management buy-out of Macquarie Group’s private markets business by its senior team in 2014, acquired a majority stake in Stone Axe Pastoral.
“We believe the long history of the Walker family in the Wagyu industry, combined with equity investment from patient, long-term investors in Australian superannuation funds, will create a highly successful, market-leading business,” Roc partner Michael Lukin, who will now be chairman of Stone Axe, told Farm Weekly at the time.
“We also believe there will be further opportunities for capital investment through the Stone Axe platform as the popularity of the Wagyu breed continues to grow.”
One year later, in February 2018, the GO NSW Equity Fund, an investment fund started by the government of New South Wales, made an A$3.3 million (US$2.37 million) investment in the company.
Jump another year, and Stone Axe had a very active month this February, beginning with cutting a deal to acquire Margaret River Premium Meat Exports (MRPME), creating one of the largest Wagyu beef operations in Australia.
Structured as a merger, the deal brought Stone Axe a business that adds full-blood wagyu cattle located across properties at Esperance, Margaret River, and Eneabba, to Stone Axe’s 4,000 head across its national operations, and which exports to 15 countries.
Another deal executed by Stone Axe this February is the establishment of a 10-year lease on Cobungra, a 6,486 hectare, $35 million cattle property, acquired by Rural Funds Management (RFM) in Victoria.
Continuing its growth strategy, the joint venture structure of the deal for Yarranbrook allows for the growth of the feedlot’s capacity as Stone Axe’s business expands.
“Stone Axe has made significant investments in its Fullblood Wagyu genetics and East Coast breeding operations and the partnership with the team from John Dee represents another significant milestone in Stone Axe’s plans to be a leading vertically-integrated producer of premium Wagyu beef,” said Richardson.
~ Lynda Kiernan