Forestry firm cuts growth strategy

By PAM GRAHAM

Evergreen Forests, the stock exchange's only pure forest ownership play, has decided to downsize.

It has abandoned a growth strategy, will shift a smaller executive team from downtown Auckland to Mt Wellington and is open to offers on its non-core forests.

Mark Bogle, the chief executive since 1995, will leave at the end of a transition to be completed by June 30, which reviews three senior positions and creates a role of general manager.

The board is reduced to four members with the retirement of Bill Falconer and Jim McLay on April 16.

At its annual meeting last October after 10 years as a listed company, Evergreen announced a complete review of its strategy, including whether it would remain listed on the stock exchange.

"The period to June 30, 2004, will be a watershed," chairman Peter Wilson said at the time.

Wilson said yesterday that the company would stay NZX-listed. He said Evergreen did not have a forest sale programme as such but would consider selling young forests and forests suitable for other land uses.

The company has largely failed to attract local investors and about 80 per cent of its investors are foreign.

Evergreen's biggest investor is the Ohio Public Retirement System, with 42 per cent, and it also has wealthy West Coast American families on its register.

Evergreen was linked to the Kiwi Forest Group, which bought Fletcher Challenge Forests' estate and at one point Evergreen shares were offered for Fletcher's forests in an attempt to create a larger listed forest owning company.

Since Evergreen listed around the peak of the last commodity cycle the industry has been affected by a string of external events, including the Asian financial crisis, Sars, heavy cutting of Russian forests and now high shipping rates and a high New Zealand dollar. The latter has eroded gains in commodity prices.