If Fletcher stumbles a rival waits

By CHRIS DANIELS

Fletcher Challenge Forests managers have been told that another, unnamed suitor is eager to buy the giant Central North Island forest.

Late last month, Fletcher announced that it had won the right to put in a final offer for the assets of the Central North Island Forest Partnership (CNIFP).

But yesterday it was told that, should it be unsuccessful, there was another buyer ready to go.

"Fletcher Challenge Forests has been advised by the receivers of the Central North Island Forest Partnership that a 'back-up agreement' for the sale of the assets of the CNIFP had been signed by the receivers with another party," said the company.

It said the contract signed for the proposed purchase by Fletcher of the partnership was conditional on the company meeting several requirements. A shareholders' meeting would then need to approve the deal.

Receiver Michael Stiassny said he could not identify the backup buyer because of a confidentiality agreement.

Details of the deal to buy the partnership assets are sketchy, but Fletcher does not have the cash to buy the 162,000ha of forests on its own, and has already said it is involved with a second, still anonymous, party in putting together a bid.

Fletcher has a temporary waiver from the Stock Exchange rule requiring a buyer to explain how it will pay for a purchase if the price is worth more than 10 per cent of shareholders' funds.

No price has been disclosed for the purchase of the partnership's forest but it is not expected to be for much more than the $1.4 billion the partnership owes its bankers.