Overseas investment decision for case 201610009 - Sumitomo Forestry Co., Ltd.

An overseas investment in:

• sensitive land, being the Applicant's (or its 100% subsidiary, Tasman Pine Forests Limited’s) acquisition of a freehold interest in approximately 20,436.6700 hectares of forest land and a leasehold interest in approximately 154.7518 hectares of forest land in the Nelson/Tasman region; and
• significant business assets, being the Applicant’s (or its 100% subsidiary, Tasman Pine Forests Limited’s) acquisition of property in New Zealand used in carrying on business in New Zealand for consideration exceeding $100m.

The Applicant has operated in New Zealand since 1984 when it established Nelson Pine Industries Limited (Nelson Pine).

Nelson Pine owns a manufacturing facility which specialises in the production of high quality buildings materials.

The Applicant wishes to secure wood resources for Nelson Pine’s processing facilities and to increase the vertical integration of its Nelson operations.

The Vendor owns, and procures the management of, certain commercial timber plantations in the Nelson/Tasman region. It is the New Zealand investment holding company for Hancock Timberland Fund VII (Fund), and it is selling the land as part of the overall process of winding up the Fund.

The overseas investment transaction has satisfied the criteria in sections 16 and 18 of the Overseas Investment Act 2005. The 'substantial and identifiable benefit to New Zealand' criteria were satisfied by particular reference to the following factors:

Overseas Investment Act 2005
17(2)(a)(i) – Jobs
17(2)(a)(iii) – Increased export receipts
17(2)(a)(vi) – Increased processing of primary products
17(2)(b) – Indigenous vegetation/fauna
17(2)(c) – Trout, salmon, wildlife and game
17(2)(d) – Historic heritage
17(2)(e) – Walking access
17(2)(f) – Offer to sell seabed/foreshore/riverbed to the Crown

Overseas Investment Regulations 2005
28(e) – Previous investments
28(g) – Enhance the viability of other investments