Baigents ‘bruised’ but in good shape

Press, 12 April 1982, Page 2

Baigents ‘bruised’ but in good shape

Nelson reporter The forestry firm of H. Baigent and Sons will not extend the option by C.S.R. to become a 70 per cent share-holtier in the Nelsonbased company. “Baigents had emerged quite bruised and battered but otherwise in excellent shape," said Mr Brian Wall, the managing director of the company.

He said his company was now in a position to have close talks with “interested parties” who had been "waiting on the sideline to see what action C.S.R. took."

C.S.R. held the option until midnight on April 9. It sought a further six-month extension which the board of Baigents refused. As a result the consortium's proposal to build a $155 million pulpmill and sawmill in Eves Valley has collapsed. Mr Wall said that Baigents would continue discussions

with C.S.R. to see if the project could continue. “In view of the C.S.R. board decision not to proceed at this time, we have decided also to consider other options open to the company. Baigents have been committed to the C.S.R. option for the last four years, during which we have had to, put off many decisions on matters which in the normal course of events would have been resolved,” said Mr Wall. “Even so, H. Baigent and Sons emerge from this period as a very sound company with the resources and staff to-carry it forward to a bright future. While considering other options the company will press on with its traditional business of expanding our forests, sawmilling, log and chip exports and supplying . building materials,” he said. Baigent’s forests' covered more than 16,700 hectares in the north Nelson district. In the first seven years of the Eves Valley project (1983 to 1990) Baigent forests would have supplied more than 80 per cent of the total timber required. His company would respond to the Minister of Forests (Mr Elworthy) by April 30. Asked if the Eves Valley land would still be available to Baigents should C.S.R. not show further interest and Baigents found a new partner, Mr Wall said Baigents had always held an option to buy the land if it wanted it. He denied that the consor-

tium had not done enough market research on the project and that the present market difficulty was the sole reason for the delay in the project. “C.S.R. Baigents have spent considerable sums of money and time on this critical aspect of the project, The marketing team has made many trips to Japan and other Asian countries during the last four, years and we. have employed some! of the best forest industry market, consultants and' researchers in the world. We have also commissioned two extensive mechanical pulping trials using Nelson wood to provide samples for potential customers,” said Mr Wall. By 1985 it was expected that demand would be expanding in Japan and Asia for the growth of mechanical pulp proposed. “The production of sawn timber combined with on-site further processing of both the sawmill and forest residues into mechanical pulp is the best use for the available Nelson exotic forest re-. source,” said Mr Wall.

The Minister of Energy (Mr Birch) said there was no doubt other options for processing the Nelson State forest could be just as attractive as the abandoned C.S.R.Baigents venture, reports the Press Association.

Baigents had now attracted considerable interest from New Zealand companies, said Mr Birch. “They may be able to put together a more attractive package than before," he .said.

It was now up to. Baigents to consider its options. The way w r as still clear to continue negotiations with C.S.R. The Prime Minister (Mr Muldoon) said he was not disturbed about the collapse of plans. “I welcome it.” he said. “It opens the whole thing up. We would not regard the fact that Baigents has turned down C.S.R. as any kind of tragedy.”

The State wood was there and the Government was looking for someone to use it, said Mr Muldoon.