FORESTRY company OneFortyOne Plantations has stunned the forestry sector by announcing its intentions to purchase Carter Holt Harvey’s Jubilee Highway sawmill in Mount Gambier.
Shocked employees were told of the likely acquisition at the sprawling site this morning, which will be the biggest shake-up in the regional processing industry in a decade.
CHH is now likely to fully exit the region’s timber processing sector amid the looming sale of its particleboard plant on White Avenue to the Borg Group.
OFO also plans to purchase the company’s woodchip operations at Portland.
Chief executive officer Linda Sewell described the intended acquisition as further evidence of the company’s strong commitment to the Green Triangle.
“Our company’s purpose is to build a dynamic industry in and around our forest,” Ms Sewell said.
She said the announcement represented a landmark investment, combining OFO’s world class forest with a significant regional mill.
“This is a great business and it is an excellent opportunity to provide security to the local forestry sector, creating benefits for everyone,” Ms Sewell said.
“OFO holds a 105-year lease over its Green Triangle forest estate and its ongoing success relies on there being a vibrant regional industry.”
Ms Sewell said the announcement also signalled a vote of confidence in the regional sector and demonstrated the resilience of the economy in the South East.
“We are the only forest grower in the Green Triangle that supplies logs to all local timber processors,” the company chief said.
“Since assuming custodianship of the forests five years ago, we have increased supply to domestic customers by 45pc.”
Ms Sewell said the company was committed to retaining a diverse and enduring customer base.
“This is unchanged as a result of today’s announcement,” she said.
“Going forward we have no plans to expand the mill. We will continue to manage the forest estate on a sustainable basis and meet our obligations to the state for an average age of clearfall of 32 years or greater.”
OFO has also confirmed there will be no job losses as a result of the change of ownership of the Jubilee Highway mill.
The company also confirmed that it continued to evaluate the feasibility of its proposed greenfield particle board mill and expected to have more news on this project in the next six months following successful completion of the Jubilee Highway acquisition.
The completion of the acquisition is subject to certain conditions, including review and approval by the Australian Competition and Consumer Commission (ACCC).
OFO holds long-term harvesting rights to a softwood plantation estate in the Green Triangle region comprising over 80,000 hectares.
Operating across the Green Triangle region, OFO directly employs 65 staff members along with more than 500 silvicultural, transport and harvest contractors from local communities
OFO currently supplies all local Green Triangle processors with product, ensuring a dynamic and competitive market for log processing, according to the company.
“Our diversified customer base sees over half of our plantation fibre being formed into structural timber, with the balance comprising of packing timber and resultant pulpwood,” the company said in a statement.
