Whanganui District Council selling forests to overseas investor

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A secret overseas buyer is poised to buy a large chunk of the Whanganui district's forests. An official announcement is expected within a few months.

The deal is awaiting approval from the Office of Overseas Investment and involves four forests, including land, owned by the Whanganui, South Taranaki and Ruapehu district councils.

The forests are McNabs, Te Ara To Waka, Sicilies and Tauwhare. Forests at Nukumaru and Waitahinga are not part of the deal.

The identity of the buyer remains confidential until the purchase is finalised - as does the price - but is believed to be part of a Japanese-based forestry investor.

Whanganui council manager Rowan McGregor said the deal, if it goes through, would be announced in June or July.

Meanwhile the council's joint forestry committee is to ask the council for a top-up of $250,000 to help cover costs associated with the sale, some of which will be recovered from the buyer.

A report tabled at its meeting on Thursday said the sale had been delayed because of several factors, including a delay in the harvest at McNabs Forest and that ongoing costs would require extra working capital as a result.

The council is also selling 30,000 carbon credits, which are not part of the forestry sale. The council is waiting for the price of the credits, now about $18, to rise before it sells.

McGregor told the meeting he was heartened by the process imposed by the Office of Overseas Investment, which went to great lengths to ensure New Zealanders were not disadvantaged from the sale.

"I thought New Zealand's interests were really being protected in that process," McGregor said.

"We are working confidentially on some things that could benefit the community."

The un-named buyer had bought three or four New Zealand forests in recent years having successfully gained OIO approvals.

The council was quietly confident the sale would also be approved.