30 June 2017
The FMA has previously notified that during its initial inquiries into Forestlands it identified $18 million which Forestlands said was to be paid to investors. We note that investors, who are shareholders in the Forestlands companies, had expressed concerns about Forestlands, how the assets were sold and how they would receive their share of the proceeds.
The FMA decided that the $18 million should be placed in trust to protect and preserve these funds and investors’ interests. It is not the FMA’s role to determine the process for allocating funds among companies or investors; that responsibility remains with the Forestlands companies and their director. The FMA remains concerned that the Forestlands companies do not have an appropriate method in place to distribute the proceeds from the sale of the Forestlands group’s forestry assets.
The absence of an appropriate distribution method prejudices the rights of all the Forestlands investors. We understand that the Forestlands companies have now instructed an independent professional services firm to assist with developing that method. Any suggestion that the FMA is preventing the appropriate distribution of funds to investors in the Forestlands companies is inaccurate. As soon as an appropriate distribution method has been established, the FMA will decide whether to consent to the release of funds currently held on trust.