The New Zealand Superannuation Fund has trimmed its substantial forestry holdings by selling 11 blocks in the North Island to mostly Chinese interests for an undisclosed sum.
The fund's general manager investments Matt Whineray said selling the 14,000 hectares of forestry would enable the fund to focus on other domestic and international investment opportunities.
“In line with our objective to maximise the fund’s returns over the long term, and factoring in the growth opportunities in other parts of our portfolio, we see more attractive investment opportunities for our purposes elsewhere.”
The China National Forest Products Trading Corporation, a log importer and subsidiary of the state-owned China Forestry Group Corporation, has purchased the majority of the portfolio, subject to Chinese regulatory approval. The remaining assets have been sold to New Zealand investors.
The timber portfolio that has been sold comprises forest crop and land in locations throughout the North Island. The bulk of the portfolio was purchased by the Fund in 2005, with some minor additions in 2008. The sale to CNFP has been approved by New Zealand’s Overseas Investment Office.
Following the sale, the fund’s New Zealand timber investments will still exceed NZ$1 billion, including its major stake in the 178,000 hectare Kaingaroa Forest in the central North Island.
The fund’s portfolio of New Zealand investments has risen in value in recent years, from $2.4 billion in June 2009 to $3.4 billion as at 31 March 2013.
Recent investments include a NZ$140 million stake in technology services company Datacom; a NZ$116 million portfolio of 11 New Zealand dairy farms; and (subject to customary closing conditions) the purchase of an additional 1.25% of Kaingaroa Forest. The fund also has more than a billion dollars invested in the New Zealand sharemarket.
As at March 31 the fund's size was NZ$22.11 billion which was a month-end high, while the return during March was 1.76%, the 12-month return was 16.29% and the return since the inception of the fund has been 8.53%.
19 Comments
Istand to be corrected ,but i am assuming that the have not only purchased the timber but also the land.
If this is correct then we deserve to have a crappy economy.
Iwonder whatthe chinese will do with 14000 hectares after the land is cleared.
Dairy conversion or a big retirement home for the communist s old leaders.
This sale is madness for a lot of reasons.
" It is a dumb idea to be selling our land to foreign interests whether they be Chinese or other."
Unfortunaely this will only become obvious after NZ has sold off most of it's territorial assets. I was speaking to some bright spark the other day who thinks that NZ can just reclaim all these sold assets by nationlalising them sometime in the future so that we get them back for free - methinks he is in for a rude awakening!
That was my understanding as well iconclast. I thought I'd phrased my reply so it wasn't aimed back at snippy and was intended for all those he was warning me about.
Maybe the following rewrite works better.
Thanks snippy. They can bring it. I know what a xenophobe is and if anyone wants to accuse me of being one that's ok. I'd suggest they look in the mirror first and also study the definition so as to use it in the correct context.
Keyser Soze - Why would you write "hates Chinese" ? You are failing to address the impacts of foreign investors in NZ.
Chinese investors actually get an exceptional deal in NZ - They don't have to pay tax on any profits earned in NZ. There is a Tax Treaty between NZ and China.
Muddying the waters by accusing people of being Xenophobic is uncalled for. Or maybe you don't want a level playing field for ALL people? If you don't Why Not?
NZ 'ers cannot go and invest in the same land type in China so therefore would find it difficult to invest there and repatriate profits back to NZ under the tax Treaty. It is ignorant comments like yours that are stopping any propert debate on this subject.
One definition of Xenophobia is: an unreasonable fear or hatred of foreigners or strangers or of that which is foreign or strange. Fear would be a better word rather than hatred. Although fear, left unchecked, can become hatred.
It is a basic proposition that as people get older, they fear change, whether it be the individual, groups, communities, or even society as a whole. The issue is not a dislike or hatred of migrants themselves, it is more a fear of the rapid changes that a disproportionately large numbers of migrants is wreaking on a small integrated society.
From 2006
This transaction represents the first purchase of timber assets for the Fund. In March 2005 it announced that it was planning to allocate up to 5% of assets to timber by June 2007, with a targeted mid-point of 2% by that date. As a long term investor, with no requirement for regular cash flows from investments, NZSF is well suited to hold timber as an asset class.
The value of the New Zealand Superannuation Fund as at 30 September 2005 was $7.6 billion
2013
A long-term, growth-oriented investor, the Fund has more than $22 billion in assets, including $3.4 billion* invested in New Zealand.
>>>>>
Recent investments include a NZ$140 million stake in technology services company Datacom; a NZ$116 million portfolio of 11 New Zealand dairy farms; and (subject to customary closing conditions) the purchase of an additional 1.25% of Kaingaroa Forest. The fund also has more than a billion dollars invested in the New Zealand sharemarket.
If they are getting as good a return as this, the bonuses must be huge, but whats the risk?
As at March 31 the fund's size was NZ$22.11 billion which was a month-end high, while the return during March was 1.76%, the 12-month return was 16.29% and the return since the inception of the fund has been 8.53%.
>>>>
Im not sure i like the superfund competing with me in farming, its bad enough with landcorp and ACC.
as AndrewJ points out, only 11% of this fund is invested in NZ. What a shame they weren't allowed to buy the 49% of Mighty River Power on sale - to be used for the benefit of all NZers. The income stream from dividends would have all stayed in NZ for benefit someday of those who get superannuation. (And any future risks relating to water 'rights' and political interference would be shared equally among NZers).
Maybe next time the Government sells a current asset, they should give the NZ Super fund first option.
As at March 31 the fund's size was NZ$22.11 billion which was a month-end high, while the return during March was 1.76%, the 12-month return was 16.29% and the return since the inception of the fund has been 8.53%.
From NZ Superannuation Fund site.
Hmmmm - *After fees, but before tax. Returns are measured on a 'time weighted' basis (monthly compounding). This is common practice when measuring investment managers' performance against benchmarks, as it eliminates the impact of cash flows. The Guardians' performance expectation is to exceed the risk free rate by at least 2.5% p.a., over rolling 20 year periods, on a 'time weighted' basis. Read more
Returns are measured on a 'time weighted' basis (monthly compounding). make your own minds up whether this method of return analysis fits with an everyday return quote from buying NZ Government stock etc.
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and
http://singaporenewsalternative.blogspot.com.au/2013/04/super-rich-moving-money-out-of.html
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http://www.smh.com.au/business/singapore-incs-roving-eye-targets-local-assets-20130424-2if25.html
Do you think they have their eye on our Biggy?
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Listen to the chatter
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You can bypass the paywall by searching for the URL in google
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Remember this guy has Party Credentials
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