Hancock buys into forest

By PAM GRAHAM



Hancock Natural Resource Group was a keen buyer of part of Tenon's forest estate in a sale that went through yesterday.

The largest of all the US timber management companies has bought cutting rights to 40,000ha of central North Island forests from Kiwi Forests Group for an undisclosed sum.

The assets, once owned by Fletcher Challenge Forests, include the right to cut one rotation from the Tarawera and Matahina forests.

Fletcher Forests was scathing about the returns its forests made as it moved to sell them. The strategy, pushed by its biggest shareholder Rubicon, has boosted its share price and created a new appreciation of the value of its wood processing and distribution assets.

But the tree buyer, Hancock, likes what it got.

"They are jewels in our minds," said Bruce McKnight, the Sydney-based senior vice-president who directs Hancock's investments in Australia and New Zealand.

Hancock buys only large, good-quality forests and it has been looking in New Zealand for nearly 10 years.

Its neighbour in the central North Island is a familiar one - Harvard University's giant endowment fund.

Hancock declined to comment on speculation that it missed out on buying big forests here because it rounds up investors after identifying a purchase.

"I can say that we looked at it several times," said chief executive Dan Christensen, of the huge former state forest estate in the central North Island.

"Obviously we have not been successful in acquiring it."

The company did buy forests in the Australian state of Victoria and Carter Holt Harvey is its largest customer in Australia.

Hancock is not commenting on whether it is interested in buying Carter Holt's forests, beyond saying it looks at all large offerings.

Said Christensen: "We aim to be good stewards to work well with the community."