Forum Archive Index - October 2002

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

Hi Hoop and Greg,

My interest in this quartet is holding shares in CAH.  My objective 
is long term to have a share in an industry where theoretically NZ 
has a strong competitive advantage, and in the medium term benefit 
from the undervaluation of the whole forestry industry.

I had a few FFS a few years back, but sold out at 90c preferring to 
concentrate on what I saw as the stronger company - CAH.  I have 
to admit holding CAH has been disappointing over the timeframe 
since, but not nearly as disappointing as if I had held onto FFS as 
well!  I note that CAH is the only one of this quartet of companies 
paying a dividend, if you discount the token effort by GPG.

I think the fact that both the FFS and CAH share price are meandering 
downwards has more to do with paper product prices and general market 
weakness rather than company specific factors.

I can't see why it is necessary to have control of CAH if they agree 
with what you are doing.  I think the reason that GPG have jumped 
aboard the FFS and Rubicon ships is that management of those 
companies do not agree with what GPG is trying to do.  I think GPG is 
looking at the long term export potential of having a more integrated 
wood industry.  Because this is an export matter, I'm picking that 
commerce commission approval is very much a side issue. 

I can't see International Paper making a full bid for CAH, as they 
have had many years to do so at even more favourable terms than 
today.  I also can't see the US banks jumping over themselves to lend 
International Paper the money to do it.

SNOOPY


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