Fletcher Forests pulls asset bid

By Phil Boeyen, ShareChat Business News Editor

Wednesday 24th April 2002

Fletcher Challenge Forests (NZSE: FFS) says it will not be going ahead with last month's agreement to purchase the assets of the Central North Island Forestry Partnership.

The forestry company announced last month that it had entered into a conditional contract to buy the assets that needed to be satisfied within a five-week time frame.

Forests boss, Terry McFadgen, says that in the time available it had not been possible to finalise arrangements, fully satisfactory to the company, to enable the conditions in the agreement to be met.

"Fletcher Challenge Forests remains an interested party in the receivership process and, given the quality of these assets, we do not rule out further interest in a purchase of the forest estate."

The company had not made public any further details of the deal, including how much it offered for the estate or how it would finance any deal.

Focus is now likely to fall on Hamilton brothers Philip and Peter Vela, who have been named as the people responsible for a back-up offer for the assets if the Fletcher deal fell over.

NBR's Rich List last year estimated the brothers' wealth at around $60 million, with most of it made from Hamilton-based Vela Fisheries although they also have extensive bloodstock interests.

The Central North Island forestry assets have been available for sale since early last year, when the partnership between Fletcher Forests and Chinese-owned Citic was put into receivership.

Although no specific sale figure has been touted the receivers will at least be looking to cover the US$645 million in senior bank debt.

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