TIDMFSF
RNS Number : 5753U
Foresight Sustain. Forestry Co PLC
06 December 2021
6 December 2021
Foresight Sustainable Forestry Company Plc
Completion of two acquisitions of substantial new afforestation
opportunities in Scotland
Foresight Sustainable Forestry Company Plc ("FSF"), an
investment company that invests in UK forestry and afforestation
assets, today announces that Blackmead Forestry II Limited ("BFL
II"), which FSF has an option to acquire, has fully completed the
purchase of two substantial and ideally located afforestation
opportunities in Dumfries and Galloway, Scotland.
Rorie Hill, one of the key afforestation opportunities which BFL
II previously had under offer, has a freehold area of 303 hectares
and will be developed as a mixed forestry and afforestation site. A
cash consideration (inclusive of tax and other transaction costs)
of GBP5.59 million was deployed to acquire the asset.
Auchenbrack, which BFL II also previously had under offer, has a
freehold area of 470 hectares and will be developed as an
afforestation site. A cash consideration (inclusive of tax and
other transaction costs) of GBP5.30 million was deployed to acquire
the asset.
Additionally, Blackmead Forestry Limited ("BFL") has completed
the sale of various buildings and four hectares of
non-afforestation land (all considered to be Non-Core Assets) at
the 150 hectare Banc Farm afforestation site in Carmarthenshire,
Wales, receiving a cash consideration of GBP0.53m.
As previously announced, FSF has entered into an Option
Agreement with Blackmead Infrastructure Limited to acquire the
issued shares of BFL and BFL II, the holding companies of the
Target Seed Forestry Assets.
The Target Seed Forestry Assets comprise 34 assets, diversified
in age, project type and geography which were valued at
approximately GBP138.0 million as at 1 September 2021. The Target
Seed Forestry Assets extend across c.11,000 hectares (equivalent to
c.27,000 acres), with 85 per cent. by area located in Scotland, 10
per cent. in Wales and 5 per cent. in England. 59 per cent. of the
Target Seed Forestry Assets are mature Standing Forests; and 38 per
cent. of the Target Seed Forestry Assets are Afforestation
projects, that will be planted; the remaining 3 per cent. of the
portfolio is made up of mixed assets.
Given that the Target Seed Forestry Assets are valued at more
than the net asset value of FSF, an asset prioritisation and
acquisition sequencing exercise is underway. There will be a
further announcement regarding the result of this exercise in due
course.
As part of a wide and ongoing deal sourcing campaign, FSF
continues to explore various development avenues and has identified
a number of specific opportunities in line with the Company's
investment policy which are either, (i) under active discussion
with the relevant counterparties, or (ii) likely to be available
for sale within 12 months. This pipeline represents a potential
investment volume for the Company of more than GBP115 million at
the date of this announcement.
Richard Kelly, Co-Head of Foresight Sustainable Forestry
Company, said:
"Foresight Sustainable Forestry Company offers a unique
investment opportunity into UK forestry and afforestation assets.
The acquisition of these sites cements two more substantial
afforestation opportunities within our Target Seed Portfolio that
will both drive attractive risk-adjusted returns for investors,
whilst also directly contributing to the fight against the twin
threats of climate change and biodiversity loss. At Banc Farm, we
now have a more concentrated, higher returning, pure afforestation
asset. Investment in UK forestry and afforestation assets offers
access to an attractive capital appreciation opportunity, as well
as the benefits we see in significantly increasing demand for
carbon credits. We continue to explore development avenues and look
forward to delivering our business plan."
About the Company
Foresight Sustainable Forestry Company Plc ("the Company") is an
externally managed investment company investing in a diversified
portfolio of UK forestry and afforestation assets. Targeting a net
total return of more than CPI +5%, the Company provides investors
with the opportunity for real returns and capital appreciation
driven by the prevailing global imbalance between supply and demand
for timber; the inflation-protection qualities of UK land
freeholds; and biological tree growth of 3% to 4% not correlated to
financial markets. It also offers outstanding sustainability and
ESG attributes and access to carbon units related to carbon
sequestration from new afforestation planting. The Company targets
value creation as the afforestation projects successfully achieve
development milestones in the process of converting open ground
into established commercial forest and woodland areas. The Company
is seeking to make a direct contribution in the fight against
climate change through forestry and afforestation carbon
sequestration initiatives and to preserve and proactively enhance
natural capital and biodiversity across its portfolio. It is
managed by Foresight Group LLP. https://fsfc.foresightgroup.eu/
For further information, please contact:
Foresight Sustainable Forestry Company Plc
Robert Guest
Richard Kelly
fsfc@foresightgroup.eu +44 20 3667 8100
Jefferies International Limited
Neil Winward
Will Soutar +44 20 7029 8000
Citigate Dewe Rogerson
Toby Moore (toby.moore@citigatedewerogerson.com)
Nick Reading ( nick.reading@citigatedewerogerson.com +44 7768 981763
) +44 7702 718740
This announcement does not constitute, and may not be construed
as, an offer to sell or an invitation to purchase investments of
any description, or the provision of investment advice by any
party. No information set out in this announcement is intended to
form the basis of any contract of sale, investment decision or any
decision to purchase securities in the Company.
This announcement may include statements that are, or may be
deemed to be, "forward-looking statements". These forward-looking
statements can be identified by the use of forward-looking
terminology, including the terms "believes", "estimates",
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"should" or, in each case, their negative or other variations or
comparable terminology. All statements other than statements of
historical facts included in this announcement, including, without
limitation, those regarding the Company's financial position,
strategy, plans, proposed acquisitions and objectives, are
forward-looking statements.
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