Hanson reaps pounds 1bn from timber sell-off

TOM STEVENSON

City Editor

Hanson's ambitious debt reduction programme took a giant step forward yesterday with the disposal of the remaining assets of the timber subdsidiary, Cavenham Forest Industries, for $1.59bn (pounds 1.05bn). The disposal means that the group has raised more than $2.8bn in the past two weeks, putting a big dent in the borrowings taken on last year from its pounds 2.5bn acquisition of Eastern Group, the electricity distributor.

Although the sale of more than 1 million acres of land in Oregon, Washington and Louisiana to Willamette Industries raised more than analysts had expected, the news failed to ignite Hanson's shares, which have languished since the news at the beginning of the year of a planned four-way demerger.

The shares closed just 2.5p firmer at 192p yesterday as the market continued to doubt the merit of breaking Hanson up into its chemicals, tobacco, building products and energy constituents. Although some brokers have put break-up values of as much as 224p a share on the group, confusion over the tax implications of the split have clouded sentiment.

William Landuyt, chief executive of Hanson Industries, the group's US arm, said that the Cavenham sale had raised more than expected and negotiations by Cavenham's management were concluded well ahead of schedule. "The net cash proceeds will reduce debt and gearing substantially," he said.

Last year Cavenham ranked as the ninth-largest private timberland owner or manager in the US with 1.75 million acres. In the year to September it made profits of pounds 95m, a fall of 19 per cent, as timber prices slumped.

The disposal follows the sale last month of 661,000 acres of timberland in Louisiana and Mississippi to the wood products company Weyerhaeuser. That sale netted Hanson $500m, which was also more than observers had expected.

At the beginning of this month, Hanson also announced that it was raising $780m from the public offer of its Suburban Propane gas subsidiary, the third-largest retail propane distributor in the US. Hanson plans to keep 34 per cent of Suburban, which will sit in its chemicals operation following the demerger.

The deal is a substantial leap for Willamette Industries, which prior to the acquisition owned 1.2 million acres of timberland in the north- west US and the south. The paper, plywood and pulp group, founded in the logging camps of turn of the century Oregon, now operates 91 manufacturing sites in 21 states. Profits in 1994 reached $178m.

Start your day with The Independent, sign up for daily news emails
News
people

Harry Potter actor suffered 'severe flu-like symptoms' on a flight from London to Orlando

Sport
Kim Sears is reported to have directed abuse at Berdych
tennis
News
news

Rap music mogul accused of running two men over in his truck

News
Gywneth Paltrow proposed that women seek out a special herbal steam-treatment service
news
PROMOTED VIDEO
News
Toronto tops the charts across a range of indexes
news

World cities ranked in terms of safety, food security and 'liveability'

Voices
A mother and her child
voices
Arts and Entertainment
tv

First full-length look is finally here

Voices
The veterans Mark Hayward, Hugh Thompson and Sean Staines (back) with Grayson Perry (front left) and Evgeny Lebedev
charity appealMaverick artist Grayson Perry backs our campaign
News
Tax now accounts for ‘nearly 80%’ of the price of a bottle of whisky
news

Arts and Entertainment
Peppa Pig wearing her golden boots
film

"Oink! Oink! Hee hee hee!" First interview with the big-screen star

ebooks
ebooksA special investigation by Andy McSmith
Life and Style
tech

Biohacking group hopes technology will lead people to think about even more dystopian uses

Arts and Entertainment
film
Life and Style
life
Arts and Entertainment
Film director Martin Scorsese
film
News
news

The party's potential nominations read like a high school race for student body president

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Product Manager - (Product Marketing, Financial Services)

£30000 - £35000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

Recruitment Genius: Compliance Assistant

£13000 per annum: Recruitment Genius: This Pension Specialist was established ...

Ashdown Group: Market Research Executive

£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...

Recruitment Genius: Technical Report Writer

£25000 - £35000 per annum: Recruitment Genius: A Technical Report Writer is re...

Day In a Page

Isis hostage crisis: The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power

Isis hostage crisis

The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power, says Robert Fisk
Missing salvage expert who found $50m of sunken treasure before disappearing, tracked down at last

The runaway buccaneers and the ship full of gold

Salvage expert Tommy Thompson found sunken treasure worth millions. Then he vanished... until now
Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Maverick artist Grayson Perry backs our campaign
Assisted Dying Bill: I want to be able to decide about my own death - I want to have control of my life

Assisted Dying Bill: 'I want control of my life'

This week the Assisted Dying Bill is debated in the Lords. Virginia Ironside, who has already made plans for her own self-deliverance, argues that it's time we allowed people a humane, compassionate death
Move over, kale - cabbage is the new rising star

Cabbage is king again

Sophie Morris banishes thoughts of soggy school dinners and turns over a new leaf
11 best winter skin treats

Give your moisturiser a helping hand: 11 best winter skin treats

Get an extra boost of nourishment from one of these hard-working products
Paul Scholes column: The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him

Paul Scholes column

The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Frank Warren column: No cigar, but pots of money: here come the Cubans

Frank Warren's Ringside

No cigar, but pots of money: here come the Cubans
Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee