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South African firm purchases Redwood Timber Merchants

South African firm purchases Redwood Timber Merchants
Written by Joan Chirwa in Johannesburg
Friday, July 17, 2009 5:07:37 AM

SOUTH Africa's Aurora Empowerment Systems has bought Redwood TimberMerchants and its subsidiaries, one of the region's largest forestry and sawmill operations in Zambia.

Local media reported here yesterday that Aurora Empowerment Systems hoped to develop Redwood Timber and its subsidiaries - Natural Africa Timbers and Zambezi Sands - to meet the high demand for timber in South Africa and export markets.

The acquisition, according to the Business Day, is part of Aurora 's expansion strategy.

The company recently announced plans to take over JSE-listed Cenmag Holdings.

Aurora chief executive officer Zondwa Mandela said the deal included investing in sectors such as tourism and mining in emerging economies, with particular focus on viable projects in Africa.

The company is also finalising details of more investments in mining, which would be announced in the next few weeks.

"We have acquired Redwood Timber Merchants...for R93.5 million. The acquisition is one of a kind as the company owns one of the largest timber concessions in the southern hemisphere and has timber valued at about $130 million covering about 80,000 hectares and equivalent to about 300,000 cubic metres of timber," Mandela said.

Aurora planned to nominate Cenmag as the purchaser of Redwood Timber Merchants subject to JSE listing requirements.

The timber firm owns and operates one of the largest sawmills in the region and specialises in harvesting various tree species.

It also makes finished timber products like flooring, doors, windows and laminated beams.

The company stated in a stock exchange announcement on Tuesday that the acquisition would be the first step towards the proposed consolidation of the regional timber industry.

Mandela said Aurora would therefore increase output of sawn timber to meet demand, which was currently outstripping supply in local and exports markets.

Labels: REDWOOD TIMBER MERCHANTS, TIMBER

posted by MrK @ 4:07 AM