Conciliatory tone averts Rubicon stoush

By PAM GRAHAM

Guinness Peat Group's approach to forestry was never a "big blueprint with thousands of people poring over it", Rubicon and GPG director Tony Gibbs said yesterday.

GPG had a vision of industry consolidation that was "more mine than GPG's" and the moment for it had now passed, he told shareholders at Rubicon's annual meeting in Auckland.

Those words extinguished any prospect of a stoush between Gibbs and Shareholders Association chairman Bruce Sheppard. Sheppard, wearing a rainbow-coloured wig after Gibbs called him a clown at the Tower shareholders' meeting, praised Gibbs for his honesty and voted for his re-election.

All the motions put to the meeting of more than 200 shareholders were passed, although proxies had guaranteed that before anyone spoke.

The two-hour meeting provided a chance for further bloodletting over the failed sale of the central North Island forests last year and a discussion about how long Rubicon, a box of assets left over from the breakup of Fletcher Challenge, should continue to exist.

At the start, the meeting had an air of a dentist's waiting room, with everyone expecting pain, but by the end shareholders were asking questions on biotechnology as a researcher showed a lump of four-by-two wood grown from a cloned tree.

Sheppard went on the attack early, questioning the order of the meeting, asking how long Rubicon expected to exist, how it would vote on the sale of forests by Fletcher Challenge Forests and disputing overhead costs.

"I find unbelievable, Bruce, that you walk into here and point at us and talk about winding up," said chief executive Luke Moriarty.

He said Sheppard had helped to scupper Fletcher's Central North Island Forest Partnership purchase last year, which would have delivered $70 million to Rubicon shareholders.

"Our obligation is to extract the most value from what we have left, and damn it, that is what we are going to do," said Moriarty.

In the most public acknowledgement yet that Rubicon sees itself as having a finite life, Moriarty said "our goal is not longevity of Rubicon".

"We have no cause to see the life of this company last beyond its natural life. How long it is, I can't tell you. But certainly if there is a favourable resolution to the forest outcome, this company will be considerably smaller; costs will be smaller."

Moriarty's reply to Sheppard earned applause, as did Gibbs' statement about his position.

Sheppard said Rubicon, as a near 20 per cent shareholder in Fletcher Forests, had an effective veto on Fletcher's forest sale because 75 per cent approval was likely to be required.

After the meeting Fletcher announced it had a letter of intent to sell its forests for $685 million.

Rubicon clearly indicated it will return money from the forest sale to its own shareholders, and raised the possibility of passing its Fletcher Forests shares onto shareholders.

Chairman Michael Andrews said directors agreed at a meeting yesterday that the nine-member board needed to be smaller, especially if the Fletcher Forests assets sold.