The battle for the hearts and minds of Great Southern scheme investors has escalated with Gordon Martin returning to the table with a revised offer and a new partner, Nick Tana.
The battle for the hearts and minds of Great Southern scheme investors has escalated with Gordon Martin returning to the table with a revised offer and a new partner, Nick Tana.
Mr Martin's new joint venture with the former fast food giant and ex-Perth Glory owner wants to see an independent group, Primary Securities, appointed as the responsible entity for Great Southern's MIS schemes and is seeking grower backing to dump the existing arrangement at a meeting on December 10.
Great Southern collapsed earlier this year owing banks an estimated $600 million.
Mr Martin announced an earlier bid to win the growers over but postponed a previous vote to give Great Southern's receiver time to muster other proposals and allow investors more choice.
He said additional bids expected from Tasmania's Gunns and Tony Jack-led Black Tree Proprietary had not eventuated.
"That was seven weeks ago. We cancelled the meeting but there's not been any other offers," Mr Martin said.
Mr Martin added that the delays could erode the value of the assets.
Under the revised offer, growers in the 1998 to 2003 schemes would get a bigger slice of the net proceeds of timber sales. In addition, Mr Martin said the 2004 and 2007 schemes would also be made an offer, subject to a successful vote from the earlier scheme growers. Previously the later schemes would have been excluded.
Mr Tana has a series of agricultural assets, having sold out of his Australian Fast Foods business in a private-equity backed management buyout of the Chicken Treat and Red Rooster operator for $180 million in early 2007.
He and his business partner Gary Inions own Bluegum Tree Management which has taken a 50 per cent interest in Pulpwood Plantations, the vehicle that made the original offer to Great Southern growers.
Mr Tana and Dr Inions are already heavily involved in the timber sector. Their company Pulpwood International has a 50-50 Bunbury woodchip mill joint venture with a subsidiary of Great Southern.
Two years ago, Great Southern Ltd bought the half share of the mill and 14,700 ha of plantations for almost $50 million from entities linked to Korean conglomerate Hansol.
Below is the media release from Pulpwood Plantations:
Pulpwood Plantations Pty Limited (PPPL), the group established by WA industrialist Gordon Martin to invest in Great Southern's forestry schemes, has set a new meeting date, Friday 10th December, in a letter to Growers encouraging them to vote to accept its offer by proxy or by attending the meeting.
Gordon Martin has explained that despite cancelling the Growers' meeting originally set for 29 October to accommodate the Receiver's advice that Growers should hold off to review alternative offers from other bidders, no such offers have been made.
In the meantime, the continued delays are eroding the value of woodlots. Growers are also liable to pay the Receiver's funding costs until it is removed as Responsible Entity.
PPPL is strengthening the Board with the appointments of Dr Gary Inions, a career forester with over 20 years experience in the industry, and Nick Tana, a leading figure in the agricultural and business sectors.
Phillip Butlin has stepped down as a director of Pulpwood Plantations and transferred his entire interest in PPPL to Bluegum Tree Management Pty Ltd., a company owned by Dr Gary Inions and Nick Tana.
Following in-depth analysis by its new directors, who have many years experience in timber harvesting, chipping and sales, PPPL has made a new offer to Growers in the 1998-2003 schemes, offering a greater share of harvest proceeds.
PPPL has also outlined the share of harvest it proposes for the 2004-2008 schemes, should it be successfully appointed to the 1998 - 2003 projects.
Gordon Martin, Chairman of Pulpwood Plantations says: 'Now that the Administrators are moving towards liquidation of Great Southern assets, growers need to act decisively to preserve the value of their investments.'
Pulpwood Plantations says that were its offer to be accepted, it will defend Growers' rights to participate in a second rotation plantation after the first, which should significantly improve their long term investment returns.
PPPL is also emphasising that, under its proposal, Growers' investments will be overseen by a fully independent Responsible Entity (RE), not an in-house RE, which will act to protect Growers' interests.
Bob Pearce, Executive Director of the Forestry Industries Federation of WA says: 'Unless this matter is quickly resolved, the whole basis of the forestry schemes will collapse.
As every week goes by, the situation gets more and more untenable.'
