retaining semen interest

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Cattleman200

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It usually means the seller thinks the bull has a better than average chance to turn out to be a really good breeding bull and they dont want to miss out on a chance to cash in if he does become a bull that sells alot of semen. The seller usually indicates a percentage of semen interest that they would like to retain in writing. If semen is sold later through a semen company the proceeds check would be split between the owners accordingly. I own two bulls with partners now that work the same way. When I get a check from a semen company it shows that I own 50 % of the bull. If semen is sold private treaty it would be up to buyed and seller to split proceeds equally. I hope this helps you understand it better. If not maybe someone else can add more to what I have told you.

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BRG

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Ussually when we do this, we sell him and keep and interest so we can AI to him as well.
 
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lilcowgirl

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so then if I sell this bull and want to retain semen interest then who's usually the one that collects and stores semen? are we able to use the semen at choice for our own herd? if drawn before he's sold. who's usually responsible for storage, costs, etc.? do we have the option to sell semen private treaty or just the ones who have possesion? is this considered 1/2 ownership in the bull?
 

Cattleman200

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so then if I sell this bull and want to retain semen interest then who's usually the one that collects and stores semen? are we able to use the semen at choice for our own herd? if drawn before he's sold. who's usually responsible for storage, costs, etc.? do we have the option to sell semen private treaty or just the ones who have possesion? is this considered 1/2 ownership in the bull?

These are all things you would need to discuss with the potential buyer. My partners and I usually split all costs on collection, storage etc. Usually if you retain a semen interest you have the option to use the bull for AI in your herd as much as you want. Some deals made only allow the seller to retain 50-100 units a year for personal use. Again, it all depends on what kind of agreement you would make with the buyer of the bull. I own 50 % possession and 50 % semen interest on these two bulls that I have. If you sell 100% of the bull and only retain a semen interest you could usually ask a little more in price than if retaining 50 % of possession of the bull. These are all things you would need to have in writing at the time of sale because we dont live in a perfect world and if a bull starts selling semen in large quantities you would have an agreement just in case you found out your new partner just sold 200 units to someone and didnt tell you about it. :mad:

Circle H Ranch
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Brandonm2

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I think that all that should be spelled out in the specific contract. He may just want a percentage of the NET IF one day you descide to market the semen. He may have a tank full of semen he has already collected and he wants the right to use all or a percentage of that in his own herd. I think these things are USUALLY a straight forward partnership agreement where the owner with full possession can use him naturally or show him and has to pay for all the upkeep; and all the partners pay into any collection and/or semen storage costs and then they split the net. Marketing is the big question I would want to ask about. If you run an ad about the bull in the breed magazine, does your ad expenses get paid BEFORE the semen split or does the semen partner get his percentage without any of YOUR advertising thrown in and vice versa. Can either party make the decision to collect the bull without input from the other party and then bill the partner for a percentage of the costs. Is his interest transferable? These questions OUGHT to be easily understandable from the contract itself. If they are not you might want an attorney to look over it. I think MOST of the time this is just a marketing gimic to make the buyer think the bull is worth more than he really is.....but then again bull syndicates are both a normal and established part of this business.
 

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