Stake in ITC nabbed as assets sold
Agribusinessgroup Integrated Tree Cropping (ITC) has moved to reassure investors in its managed investments schemes that its timber projects will be unaffected by recapitalisation moves and the purchase of a 50 per cent stake in the group by financier Futuris Corporation.
ITC has struck a deal with UK-based Sustainable Forestry Management (SFM) to buy the land and timber assets of ITC.
The deal, which is subject to due diligence and approval from ITC’s lenders, will see ITC retain a $12 million investment in an SFM Australian subsidiary with an option to take this investment up to $24 million.
This move follows on from separate action by Futuris, which is taking a 50 per cent stake in ITC and will underwrite a renounceable rights issue for all shareholders, generating about $20 million of new capital.
In future, the land owner of the schemes will be SFM while ITC will mange the crops, with the former set to acquire further land for future schemes.
ITC managing director Tony Jack says the moves are part of the rationalisation process occuring in the Australian timber industry.
ITC lodged its latest timber managed investment scheme prospectus with theAustralian Securities and Investments Commissionlast week and Jack says it contains a number of innovations.
Investors will pay for the establishment of the plantation and ITC will commit to maintaining the trees through to harvest for a share of about half the harvest proceeds.
AUTHOR
Jason Spits
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