$5M Kaurex write-off

Press, 29 January 1988, Page 20

$5M Kaurex write-off

PA Wellington Leyland Growth has totally written off its $5 million investment in Kaurex Corporation, said Leyland Growth’s chief executive, Mr Alan Lee. No additional funds would be put into Kaurex by Leyland Growth, which is Kaurex’s largest shareholder. Kaurex has said that it will run out of money on Sunday. Mr Lee said that Kaurex’s gum processing plant would need between SIOM and SISM to upgrade and replace equipment. Even then it would make a loss for a year and have an uncertain revenue stream after that. It was not the sort of project that would fit Leyland’s direction. Mr Lee added. Leyland’s holding in Kaurex was now 23 per cent. - That company’s directors had canvassed a wide range of companies for additional finance and at this stage noone had taken up the offer, Mr Lee said. Asked if this meant Kaurex

would fold, Mr Lee said: “I think the Kaurex statement in January indicated if it did not get additional finance it would. Your comment is correct.” Kaurex’s chairman. Mr John Stevens, said yesterday: "We’re still working on it (financing) and I can’t say anvthine more.” Finance from NZI, another big shareholder in Leyland Growth, was still a possibility, he said. NZI management could not be contacted today to confirm this. Kaurex was set up as a public unlisted company in 1973. It listed on the Stock Exchange in 1985, after a 45.5 M share issue. The company was set up to extract kauri resin and wax from the Kaimaumau Swamp, in Northland. The products were to be used in inks, polishes, cosmetics and various surface coatings and adhesives. Although the plant was officially commissioned in 1986, it has never been operational.