Fletcher Challenge Consolidating Management Of Two Paper Producers
Jun. 24, 1988
VANCOUVER, British Columbia (AP) _ Fletcher Challenge, the New Zealand-based conglomerate, is consolidating the management of two major British Columbia forest-products companies, creating a entity with about $2 billion in annual sales.
Crown Forest Industries Ltd., which is wholly-owned by Fletcher Challenge, and British Columbia Forest Products Ltd., in which Fletcher holds a 69 percent stake, now will be managed as Fletcher Challenge Canada Ltd.
The move is subject to approval by B.C. Forest Products shareholders at a special election scheduled Sept. 2, said Stuart Clugston, spokesman for B.C. Forest Products.
The new entity will have about $1.8 billion in assets.
Ian Donald, Fletcher Challenge's executive director in Canada, said the amalgamated management would result in substantial clout in international markets.
''Combined with Fletcher Challenge's other interests in New Zealand, Australia and Chile, the organization worldwide is the second-largest producer of newsprint and the third-largest pulp producer,'' Donald said in a news release.
Clugston said some jobs in coastal wood operations could be eliminated as redundant, but predicted that because the companies' operations would remain separate the employment impact of the management consolidation should be small.
Fletcher Challenge moved into the provincial forest industry in 1983, buying all the operations of Crown Zellerbach Canada Ltd. In 1987, Fletcher, whose diversified operations include construction, fishing, agriculture and oil and gas, acquired 48 percent of B.C. Forest Products shares.
After obtaining provincial government permission, Fletcher increased its stake to 69 percent in October.
Fletcher Challenge, which has 41,000 employees worldwide, had 1987 earnings of $395 million on sales of $4.9 billion.