Sydney based New Forest group is competing with four international players to buy Forest Enterprises Australia (FEA), which is tipped to sell for as much as $400 million. Source: The Australian
The company joins US-based Campbell Group, GMO Renewable Resources, Global Forest Partners and Resource Management in vying for FEA.
FEA was put on the market in December through Gresham and Deloitte, shortly after timber company Gunns came up for sale for what is thought to be about $400m.
Initial bids closed this month and Deloitte said the shortlisted parties would soon be invited to conduct due diligence. Local and international interest had been strong, Deloitte said.
The sale will offer hope to thousands of investors who poured $400m into the business over many years.
FEA has 97,900ha of mature hardwood forests and 46,000ha of land in NSW, Queensland and Tasmania.
The sale price is expected to be between $200m and $400m. With at least $700m of Australian forestry assets currently on the market, it had been thought that the parties competing for FEA would also chase the Gunns assets.
However, sources would not comment on whether those parties were interested in Gunns.
New Forests, which has $2.1 billion of assets under management globally, bought Great Southern’s land bank in 2010 for $415m, and purchased the trees on the land during the next two years.
Chief executive David Brand would not comment on speculation but he said the company was looking at opportunities. Other parties could not be reached for comment.
The Campbell Group is one of the largest managers globally, with $US6.1bn worth of timberland under its control, and in 2012 it led a consortium to buy more than 100,000ha of softwood forestry assets from the South Australian government.
Boston-based GMO Renewable Resources has invested about $US3.2bn in rural assets in eight countries, while Global Forest Partners manages about $US3.6bn in forestry assets and Alabama based Resource Management Services has offices in New Zealand, South America and China.
The Gunns business is being sold through insolvency firm KordaMentha and investment bank Moelis.
Real estate firm CBRE is also selling forestry assets owned by Queensland government subsidiary Ergon Energy and a separate portfolio of Tasmanian forests controlled by Gunns.
