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Wesfarmers sells interests

TRADING house Marubeni has bought Wesfarmers woodchip and plantation interests for $58 million.

The sale agreement covers WA Chip & Pulp, Sotico Treefarms, South West Forest Holdings and Wesfarmers’ interest in Bunnings Tree Plantations.

Wesfarmers managing director Michael Chaney said the sale price was in line with the current book value of the assets.

“We have had a long and close association with Marubeni as the trade housing handling our woodchip exports,” Mr Chaney said.

He said the decision to sell flowed from the review of the Sotico business initiated 12 months ago.

In March Wesfarmers announced an accelerated transition from native forest to plantation woodchip exports following re-negotiation of sales contracts with its Japanese customers.

“While the woodchipping and plantation service businesses are well established, efficient operations, we have come to the conclusion they will deliver most long-term value in the hands of a major participant in global woodchip supply such as Marubeni,” he said.

Mr Chaney said the review of Sotico’s other operations was continuing.

Forest Products Minister Paul Omodei said the sale would not influence the Government’s decision to significantly reduce karri sawlog production and stop all karri old growth logging after 2003.

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