The following item was published in the New Zealand Herald 19...

The following item was published in the New Zealand Herald 19 June 2009

SUGAR RUSH

Sir Ron Brierley has welcomed news from Australian sugar, aluminium and building products conglomerate CSR's board of a plan to spin off its sugar business, said to be worth more than A$1 billion, as well as its renewable energy division.

Sir Ron's Guinness Peat Group holds just under 5 per cent of the company and this week said the move was a step in the right direction that should have been made long ago.

"GPG has put forward over a period of time credible proposals to unlock value for all CSR shareholders.

"Substantial shareholder value has been forgone by not taking advantage of restructuring opportunities before the company's dilutive capital raising late last year," it said in a statement.

While also noting the proposal looks well overdue, some Australian commentators question why CSR has made the decision to pursue this all of a sudden.

Given Sir Ron's quick response to the announcement, Stock Takes wonders whether GPG hasn't had something to do with it.

CSR says the demerger will be completed by the end of March next year and will probably include an equity raising to strengthen the balance sheets of the two separate ASX-listed entities.

We wouldn't be surprised if GPG takes some kind of prominent role in CSR's plans as they unfold.

CSR's shares gained 6 per cent to A$1.59 on Wednesday when the announcement was made but dipped to A$1.55 by the end of trading yesterday.

I hold some GPG but no direct involvement in CSR