High Brow Cat, a fabled 24-year-old American Quarter Horse stallion, was recently sold for $10 million to Colt Industries, a diversified Dallas-based investment firm, even though he has been sterile since 2010.
High Brow Cat was the National Cutting Association sire of the year 2003-12, and his offspring have earned about $58 million. Waggoner Ranch, High Brow Cat’s former owner, also collaborated with Texas A & M University to clone him, and the genetic copy is due to foal this spring.
The Wall Street Journal reported that Colt Ventures’ risky acquisition was motivated by two considerations. High Brow Cat was transferred to his new owner along with the stallion’s valuable semen bank, and this repository should be increasingly in demand because the popularity of the cutting-horse sport is booming among Wall Street moguls.
The international Thoroughbred community has steadfastly refused to register racing stock from any method of procreation except live cover. While there are credible reasons for this policy, the High Brow Cat transaction presents an intriguing financial rationale for the other side of the argument.
Artificial insemination can yield some degree of residual or salvage value for stallions, especially for exceptional stallions whose natural breeding days are over or for promising stallions that die young.
If artificial insemination were sanctioned in the Thoroughbred breed, the pensioned Storm Cat, for instance, could easily have been substituted for High Brow Cat in the narrative. Storm Cat’s selling price would almost certainly be higher than $10 million, provided the buyer received an extensive semen bank that would be analogous to an annuity.
Artificial insemination’s potential economic benefit of residual value is not in and of itself a reason to modify the Thoroughbred industry’s long-standing regulation banning the practice. However, the striking magnitude of the High Brow Cat sale needs to be dispassionately weighed against the logic for the live-cover-only rule.
The Thoroughbred industry could take a step into the 21st century by making two modest changes in the rules about registering foals: A mare can be bred by artificial insemination if the stallion and mare are on the same grounds and the stored semen of a sterile stallion can be used as long as he is still living.
Copyright © 2013 The Blood-Horse. Used with permission.
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