Minister denies Govt wants Aorangi to sell up

Press, 25 May 1984, Page 4

Minister denies Govt wants Aorangi to sell up

The Minister of Regional Development, Mr Birch, last evening “refuted absolutely” assertions that the Government wanted the West Coast plywood manufacturer, Aorangi Forest Industries, Ltd, sold to competitors. The Leader of the Opposition, Mr Lange, said earlier yesterday that the Government was trying to kill off Aorangi Industries. He said the Government wanted to “screw this company to the ground and let their competitors take up the market.”

The Government’s interest in the company was to retain employment on the West Coast at the least possible cost to the taxpayer, said Mr Birch.

There was no truth in Mr Lange’s allegations about the Government’s intentions in respect to other companies, he said. “The Government would not assist a commercial solution which took the industry and its employment away from the West Coast.” Mr Birch said that in the week beginning May 7 while considering the company’s request for financial assistance the Government had been made aware of commercial interest in the firm which had opened up possibilities for a commercial solution to its troubles. “The Government stood aside to allow those negotiations to proceed in the ex-

pectation that employment would be maintained on the West Coast,” he said. Aorangi responded on May 11 with a deadline and asked for an immediate response from the Government, said Mr Birch.

The Government had offered to consider asking the Development Finance Corporation to give minimal financial assistance to the company while possible commercial solutions were explored.

That offer remained open, he said. The Government would not compel Aorangi to negotiate with any particular party but it hoped that the company would consider any approaches.

The Government was aware that while the company’s immediate difficulties were financial they derived from a variety of management and structural problems, Mr Birch said.

The Government’s role, however, was not to bail out shareholders or creditors using large amounts of the taxpayers’ money. Mr Birch said he would be prepared to make all correspondence between Aorangi and the Government public provided the board of Aorangi gave its consent.

He denied any allegations that the Government had attempted to undermine the company and damage its interests for the benefit of competitors.

“There has been no such attempt,” he said.

“In this and his other allegations Mr Lange displays his abysmal commercial knowledge. He is in fantasy land,” said Mr Birch.