$1.5m sought by Forestry Fund

Press, Volume CXIV, Issue 33451, 5 February 1974, Page 10

$1.5m sought by Forestry Fund

(New Zealand Press Association) WELLINGTON, February 4. The Perpetual Trustees Estate and Agency Company of New Zealand, Ltd, has issued the prospectus for 1.5 m, 100 c units in the Nuhaka Farm Forestry Fund.

The fund is claimed to combine for investors the financial advantages of private afforestation with the advantages of negotiability, small denominations and limited liability. The fund will have an initial capital of sl.sm investment units of 100 c each. The prospectus shows that a little more than half the money will be spent on

capital items such as land, buildings and farm stock. The balance, with cash from farming and a forest encouragement grant, will be used for land preparation and forest planting. Relatively little revenue from tree felling is expected for 20 years, but in the 10 years after that distributions to investors are expected to be $2,800 for each $lOO invested, equivalent to an earning rate of more than 14 per cent per annum compounded for the term of 25 years. Under present law the net revenue of the fund is not taxable if distributed immediately, although distributions are taxable in the hands of investors. Application will be made for the fund units to be listed by the stock exchange.