sale of land great news

18 April 2012
Pulpwood Land and Asset Sale Agreement
? Conditional agreement for sale of freehold land, assets and standing timber in Albany,
Bunbury and Green Triangle
Elders (ASX:ELD) announces it has today signed agreements for the divestment of the large majority of
its pulpwood forestry assets in the Albany, Bunbury and Green Triangle regions to investment funds
managed by Global Forest Partners (GFP).
The agreements, which are subject to a number of conditions precedent, provide for the sale of
approximately 12,400 ha of land as well as Elders-owned standing timber in those regions and its
woodchip export facility at Albany.
The agreements also provide for the conditional sale of some MIS grower-owned standing timber in
those regions.
Net cash proceeds to Elders are expected to be realised progressively and, subject to completion, to
exceed $45 million. The gross sales value is undisclosed, but is expected to approximate book value.
Elders Chief Executive Officer Malcolm Jackman said that agreements with GFP represented a
substantial advance in the Company’s program to release capital from its forestry operations.
“Today’s announcement, which encompasses some 12,000 ha of forestry land and the Albany port
facility, represents the cornerstone transaction in the staged divestment of the Forestry business we
announced in October. We now have sales or sales agreements in place for nearly two-thirds by area
of the freehold land that we have targeted for divestment.
“We are pleased that we have been able to secure the involvement of a committed leading forestry
industry player such as GFP and expect this will be well received by growers” Malcolm Jackman said.
GFP, a US Securities and Exchange Commission registered investment advisor specializing in the
structuring and management of sustainable forestry investments, has been actively investing in
Australia on behalf of its investor clients since 1999 and currently has over AUD 3 billion in forestry
assets under management worldwide.
The transaction completion will be phased to cater for the varying maturities of the precedents to the
sale of pulpwood projects and the different approval processes and timelines required in selling these
assets. From Elders’ perspective, completion is targeted to occur, subject to satisfaction of a number of
conditions precedent, by the conclusion of the June quarter 2012.
Elders’ remaining pulpwood operations are the subject of ongoing divestment initiatives at various
stages of maturity and comprise the management of approximately 42,000 ha of standing timber on
2
leasedland in Albany, Bunbury and the Green Triangle and 10,900 hectares of freehold land and the
management of 46,500 ha of standing timber in the Esperance region. 1
Under the agreement, GFP will also assume responsibility for management of the remaining Elders
Forestry pulpwood operations in the Albany and Bunbury regions plus some of those in the Green
Triangle at commercial rates.
The agreements signed with GFP will bring the total amount of forestry land that Elders has sold or
contracted for sale since it announced its intention to withdraw from Forestry to a total of 32,000 ha.
The outstanding uncontracted forestry assets and operations, which include the pulpwood operations
noted above, sandalwood operations, teak operations and land in central and northern Queensland, are
the subject of ongoing divestment initiatives and considerations.
Forestry operations were classified as a discontinuing operation in the FY2011 accounts as a result of
Elders’ decision to withdraw from the sector. Accordingly, results from Forestry operations are included
in Elders’ statutory profit but excluded from underlying profit as a discontinuing operation, together with
other non-recurring items.
Ends
Further