Elders commissions review of Forestry assets
Elders Limited (ELD) said it has commissioned Ernst & Young to conduct an independent review of its Forestry assets in light of sector and company specific developments. The company said the review would not examine strategy and operations, where Elders Forestry is well placed.
The company said the review would involve Ernst & Young overseeing separate reviews of the various forestry assets held by Elders and delivering a final report.
Elders anticipates receiving a final report by no later than end-April 2010.
Managing director, Malcolm Jackman, said there are a number of events and developments that could impact assets valuations across the industry including Elders Forestry.
The company said developments identified with potential to impact Elders Forestry assets include the current and unprecedented levels of plantation and forest land for sale, uncertainty over the future of Forest Enterprises Australia, and reviews of plantation growth rates and yield estimates for specific regions.
Elders said Forestry assets to be included in the review include: plantation land; accrued income and income anticipated under SGARA accounting from Elders’ own plantation trees; the Company’s shareholdings; grower loans of $27 million and goodwill.
“Elders will assess land values for 100% of its 47,000 hectares of freehold plantation land under the review,” the company said.
“This compares to the review of one-third of freehold land that would normally occur under the rotational valuation review methodology.”
As at 1105 AEDT, Elders shares were down 4c to $1.315.
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