RusForest has continued it rapid expansion by agreeing to acquire additional forest lease-holding companies in Boguchany, Krasnoyarsk region.
RusForest AB is acquiring ZAO ADAR and OOO LP LDK Kansky, which hold forest leases with a combined annual allowable cut (AAC) of 470,600m³. The acquisitions are conditional upon the two companies having settled certain debts.
Adar holds a pine-dominated forest lease located approximately 110km north of the Boguchansky LPK sawmill, with an AAC of 262,700m³ and covering an area of 110,343ha.
Kansky holds a larch-dominated forest lease, located approximately 170km north of the Boguchansky LPK sawmill with an AAC of 207,900m³ and covering an area of 109,493ha.
The new forest leases complement RusForest’s existing assets in the region well, especially in light of the fact that it is expanding drying and sorting capacity at the Boguchansky LPK sawmill.
The transactions, when completed, will increase the company’s AAC in the Boguchany region to 748,400m³, and will allow Boguchansky LPK to become self-sufficient in terms of raw material supplies and help reduce raw material related costs starting from the 2011/2012 season.
RusForest’s long-term objective for the Boguchansky LPK sawmill is to reach an annual sawnwood output of 200,000m³ through the construction of additional drying and sorting capacity at the site.
Following the acquisitions, RusForest will invest into additional harvesting equipment during the autumn of 2011 and will continue to strengthen the local management in harvesting as well as in road construction.
“The competition with regards to access to high quality raw material continues to increase in Russia, not least in Siberia where Chinese companies have become very active recently,” said RusForest’s CEO, Martin Hermansson.
Following the acquisitions of Adar and Kansky, RusForest’s consolidated AAC will amount to approximately 3.3 million m³.
