Sawmiller to put plants on market

Log processor and timber manufacturer Tanner Group is putting its three soon-to-close mills at Kaitaia, Kerepehi and Tairua on the market.

No prices are being named for the sawmilling and processing operations, which are scheduled to close within three months.

Around 160 staff at the three plants will lose their jobs unless the mills are bought as going concerns or for upgrading by other parties by June.

TGL director David Warburton said he had already received several verbal expressions of interest from possible buyers.

They had been sent further information and had been asked to contact Ferrier Hodgson, which is handling the sale process on behalf of the BNZ and Tanner Group shareholders.

A public meeting in Kaitaia late last week, where all 60 workers at the TGL-owned Kaitaia Timber Company mill have been told they will lose their jobs, has set up a working party of mill staff and community members to establish whether the business there is viable.

Working party member and Engineering, Printing and Manufacturing Union northern organiser Robert Popata said trying to determine whether the Kaitaia mill was a viable business to run was the first thing to establish.

"Can you turn a dollar in it? We're saying to the company it should give the workers a chance to find out," he said.

Because staff being laid off were getting no redundancy package, apart from four weeks' notice that they were required to work out and which the union says is not redundancy, TGL should allow the Kaitaia working party time to try to put a package together if the operation was seen to be viable, Mr Popata said.

He acknowledged that hurdles included any possible buyer of the mill having enough money to be regarded as a bona fide purchaser, and production of a comprehensive business plan.

"But we can't draw up a plan until we know whether the business is worth it.

"People are leaving the mill on April 8 and more on April 22, so we'll have to work swiftly," Mr Popata said.

Another public meeting is planned in the town in April after the working party has gathered more information on a possible business proposal to put to the company.

Mr Warburton said TGL believes the Kaitaia mill has a "positive future".

It has the advantage of sawmilling and processing operations on the one site, unlike the other two plants, and it has a good supply of quality logs, Mr Warburton said.

If more processed-timber and building-supply markets were successfully established, the mill could service outlets in New Zealand, Australia and the Pacific Islands.

Mr Warburton said union suggestions that up to 80 per cent of the Kaitaia mill's production went to domestic markets - and it was therefore unfair to blame the plant's problems on a strong New Zealand dollar - were too high.

On a revenue basis, he said the proportions were about 50-50 to domestic and overseas markets.