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African forestry firm secures HSBC investment
afrol News, 24 September - United Kingdom (UK) based New Forests Company announced today that it had secured a US$8.5m equity investment from HSBC Principal Investments, to help highlight company's plans to become east Africa's largest tree planter.
Investment by one of world's largest banks into company's Uganda subsidiary, marks growing interest of UK private equity funds in finding attractive investments in Africa, company said.
New Forests Company, which was started in 2004, is a timber plantation company with operations in Uganda and Mozambique with a triple bottom line business model based on commercial profitability, environmental sustainability and social responsibility.
According to report issued by company yesterday, as well as becoming one of Africa's biggest tree planters, it has a large commitment to conservation forestry through enrichment planting of indigenous tree species and an ambitious programme of community development in education, health and clean water projects for communities in which it operates.
Company is said to be largest tree planter in Uganda and country's biggest investor in forestry sector.
Report show that by the end of this year, company will have planted more than 14,000 acres of commercial trees since 2006 in a planting plan which aims to establish about 65,000 acres by 2014 with an investment plan of about US$30m.
New Forests is also active in Mozambique and plans to develop company into a vertically integrated pan-African forestry group manufacturing diversified woods products like sawn timber, transmission poles and construction materials for local, regional and export markets.
"We are delighted to have a blue chip investor like HSBC on our share register," said Julian Ozanne, chief executive officer.
"Timber demand and prices are growing globally and sustainable plantation forestry will be only way to save Africa's threatened indigenous forests and meet growing demand on both continent and abroad from likes of India and China. Natural resources sector, especially land backed businesses, are increasing attractive in Africa especially in countries of economic growth and stability," Mr Ozane said.
Equity deal by HSBC was made by bank's African principal investments business. Under NFC deal, provision is made for HSBC's investment in-group to expand to US$23.5m as company rolls out its business model to other countries and begins setting up manufacturing plants.
By staff writer
© afrol News
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