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Evergreen Forests Limited is the only listed pure play plantation forestry investment company in New Zealand and Australia. Evergreen has built steadily from an initial base of 1,166 stocked hectares. Evergreen's goal is to grow from its current position (19,461 stocked hectares) to develop a portfolio of plantation forestry investments with a value of at least NZ$300 million. Priority is given to established plantations that complement the existing estate in terms of location, quality and maturity. The company has considerable reserves of mature and semi-mature standing timber, and the proportion of forests 20 years and older by value is now very high compared to 1993.
1 Source: Valuation reports 1993 & 2004. Evergreen has demonstrated that it can acquire mid-rotation forests at appropriate values that meet its strict investment criteria. Evergreen was formed in August 1993 with initial capital of NZ$23 million. The company merged with CBS Forests Limited in January 1995 immediately following an injection of NZ$50 million into CBS Forests Limited by Xylem Investments Inc, L.P., a U.S. fund manager based in Boston. The acquisition of four South Auckland forests in 1997 was funded by way of a placement of 30.7 million shares at NZ$0.555, mainly to a number of U.S. based institutional investors including Société Générale Asset Management, Corp. The company raised NZ$22.4 million through a zero coupon convertible note issue in early 1999. As a result of the issue, Hambrecht & Quist Guaranty Finance, LLC, a subsidiary of the U.S. investment bank Hambrecht & Quist, became a significant security holder in the company. In October 1999, the company placed an additional 6.1 million convertible notes at NZ$1.06 and at NZ$1.10, of which 1 million convertible notes were acquired by Société Générale Asset Management, Corp. The funds raised in the placement combined with debt (mainly vendor finance on normal commercial terms) financed the purchase of two East Coast forests.
1 On a fully diluted basis, assuming conversion of all convertible notes into shares at $0.55 per share. Source: Evergreen Forests Limited. |
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