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Harvard eyes more forests downunder

By Duncan Bridgeman

Friday 31st October 2003

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With the jewel in the crown of New Zealand forestry already tucked under its belt, Harvard University could end up owning another 106,000ha of the central North Island.

Harvard has more than $US200 million invested with the Campbell Group, the Oregon-based company that signed an exclusive deal to buy Fletcher Challenge Forests' estates for $685 million.

While Kiwi Forests Group topped the bid, offering $725 million, Campbell is still involved in the sale process and holds $8.5 million of a $17 million break fee agreed to by the Fletcher board.

Asked whether Harvard was backing Campbell, Fletcher Challenge Forests general counsel Paul Gillard said: "No comment."

"Should we not continue with the Kiwi Forests Group then we will re-engage with Campbell."

The Campbell Group has not responded to repeated calls over the past two weeks. Management has also failed to reply to emails. The company, a subsidiary of United Asset Management, describes itself as a timber management firm whose business is to "acquire, manage and dispose of timberland for individuals, trusts and institutional investors."

Investors include the Massachusetts Commonwealth Pension fund and Calpers, the biggest pension fund in the US, with assets of more than $US171 billion. Campbell also regularly buys assets for undisclosed investors, such as its 1998 purchase of 47,348ha of forest land from Willamette Industries.

Harvard Management Company, through GMO Resources, bought the Central North Island Forest Partnership from receiver Michael Stiassny last week for an undisclosed sum.

When Fletcher Challenge Forests put up a joint bid with Citic last year Mr Stiassny said the banks would not take less than the $US650 million ($1.06 billion) they were owed.

Industry sources said Harvard's attention was drawn to New Zealand by Andy Wiltshire, formerly of Rayonier NZ.

Bond Offer: Infratil Ltd, 7.2 year & 10.2 year unsecured unsubordinated bond


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