Timber industry angry at Carter Holt expansion

By Phil Boeyen, ShareChat Business News Editor

Tuesday 17th April 2001

The New Zealand Timber Industry Federation is considering legal action against Carter Holt Harvey's (NZSE: CAH) purchase of Norske Skog's Tasman pulp business.

President, John Hawkins, says the federation is considering applying to the High Court for an order to overturn the recent Commerce Commission decision granting permission for CAH to buy the pulp mill.

Mr Hawkins is claiming that natural justice was denied to key parties.

"In our opinion the Commission failed to consult adequately with or give proper opportunity for consultation to almost all of the independently owned sawmills drawing wood from that region and supplying chips.

Mr Hawkins says the federation is also vigorously opposing the CAH's Commerce Commission application for permission to buy the assets of the Central North Island Forestry Partnership.

"In our opinion this is a blatant attempt to gain dominance and pursue anti-competitive behaviour in a wood volume sensitive region.

"Our concerns particularly relate to attempts to dominate high quality log grades and the likely resulting market share of structural grade sawlogs.

Mr Hawkins says Carter Holt has consistently published a strategy of buying up third party wood lots as a vehicle for raising prices, and to give the company permission to buy the central North Island forests would be a travesty of justice.

"Industry investors and the New Zealand economy have endured more than their share of misfortune from failed grand strategies amongst publicly owned forestry companies.

"The receivership of the largest pine forest in the Southern Hemisphere is tragic evidence of power plays which go wrong."

The Timber Industry Federation says what the forestry sector and its customers need if more competition, not less.

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