New Forests has agreed to acquire a 75% stake in Kolombangara Forest Products Limited (KFPL), in the Pacific nation, Solomon Islands, for its Tropical Asia Forest Fund 2 (TAFF2).
KFPL, the Solomon Islands’ largest sustainable forestry business, comprises around 14,000ha of fully developed mature hardwood plantation and 26,000ha of rainforest under conservation management.
Under the agreement, TAFF2 will work alongside Kolombangara Island Investment Limited (KIIL) and Investment Corporation of Solomon Islands (ICSI) to deliver long term economic, environmental and social impacts to the Solomon Islands and the Kolombangara community.
As part of the broader partnership, the ICSI agreed to transfer 20% of its 25% stake in KFPL to KIIL.
The transaction is significant because the Solomon Islands’ government has met its 30-year commitment to the people of Kolombangara, who will now have a direct stake in KFPL through KIIL’s ownership and local landowners will be actively involved in shaping the company’s future.
Jeremiah Manele, prime minister of the Solomon Islands, said: “We welcome the progress of this partnership and recognise its potential to deliver meaningful benefits to local communities and the broader Solomon Islands economy.”
Geoffrey Seeto, senior managing director and head of emerging markets at New Forests, said: “KFPL has a rich history of sustainable forestry, and we are excited to build on that legacy. Together, we will look to enhance forest management, support local communities, and ensure that the natural capital of Kolombangara Island continues to thrive for generations to come.”
Edwin Schramm, general manager of KFPL, said: “With New Forests’ support and the involvement of landowners through KIIL, we are well-positioned to strengthen our operations, invest in our workforce, and continue delivering sustainable value to the Kolombangara community.”
New Forests aims to expand KPFL’s customer base across Asia Pacific, as the company currently has China and Vietnam as its largest markets for eucalyptus hardwood.
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