Invercargill City Forests has bought a 24.9% stake in forestry management company IFS Growth. Source: Scoop NZ
Invercargill City Forests is a subsidiary of council-controlled organisation Invercargill City Holdings, while IFS Growth is an Invercargill-based company that works in forest management throughout New Zealand.
Invercargill City Forests chairman Les Pullar said the council had nearly 3000 hectares of forestry and was aiming to increase that figure to between 5000 and 6000.
The council had added about a thousand hectares to its portfolio in the last three years, Mr Pullar said.
“We made a conscious effort to expand and get more forests,” he said.
Invercargill City Forests aimed to remain contained within Otago and Southland.
“From an economic point of view it’s good to have Otago and Southland people working within.”
He said the company’s collaboration with IFS Growth had already been successful for Invercargill’s ratepayers and the wider Southland region.
The dividends Invercargill City Forests paid to council offset rates by about $550,000 a year.
The investment would create further income for the company, Pullar said.
“We are delighted to partner with a company as skilled, responsive and with the local and national track record of IFS Growth,” Mr Pullar said.
IFS Growth managing director Dan Minehan said the buy would allow IFS to grow faster and create new opportunities.
Mr Minehan said it would strengthen both businesses, with benefits for both Southland and New Zealand.
Included in the sale is a proportionate share of IFS Growth’s harvesting brand, OneForest.
IFS Growth was founded in 2001 and has staff based at offices in Invercargill, Dunedin, Upper Hutt and Kaitaia.
Mr Minehan said the company had implemented growth plans strongly in the last few years including moving into two new regions, Wellington and Northland.
The company has developed significant overseas customers, predominantly in India and China.
“This purchase means that our business will be going even harder and faster in terms of strategic growth, as we leverage each other’s strengths,” Mr Minehans said.
For 15 years IFS Growth managed the forests owned by Invercargill City Forests throughout Otago and Southland.
ICFL chairman Les Pullar said the council’s forestry businesses had expanded to where it needed to invest in forestry management.
