SUNBIZ

Fiji Forest Industries Bought Against Report Finding, Owners Now Looking For Interested Buyers

The company is now looking for interested buyers for its subsidiary company, FFI, in Malau, Labasa. The property comprises the land, factory buildings, jetty and residential quarters
12 Nov 2019 04:30
Fiji Forest Industries Bought Against Report Finding, Owners Now Looking For Interested Buyers
The Fiji Forest Industries Limited sign board in Malau, Labasa.

Tropik Woods Industries Limited bought Fiji Forest Industries (FFI) Limited in 2002 despite reports findings that it had no future.

Tropik Woods Industries Limited chief operating officer, Vimlesh Kumar said independent reports found that FFI had no future, no resource and heavily debt-ridden but they still purchased it.

The company is now looking for interested buyers for its subsidiary company, FFI, in Malau, Labasa.  The property comprises the land, factory buildings, jetty and residential quarters

FFI, which is now closed with most of its machinery sold through tender.

“It was the decision of the management at that time, and imagine the amount of money poured in on a company not having any future. We had to do that out of our social responsibility particularly towards the livelihood of our workers,” Mr Kumar said.

“Year in and year out we had to provide financial support from the parent entities.

“Even the auditors had to ask for a letter of support annually from parent entities for the financials of FFI to be prepared under Going Concern.

“Tropik Woods, Fiji Pine Limited and Tropik Woods Products lost a total of $9 million and that was money put in but not recovered – written off.

“This does not factor in the many subsidies provided.

“FFI was exposed to winding up action by external parties due to its heavy debts.

“It reached a stage where it could not meet statutory payment obligations.

“With the little to no value for its obsolete assets and heavy debts, winding up action would have resulted in our workers not receiving a single cent.”

Fiji Forest Industries Limited has been closed for operations and put up for sale.

Fiji Forest Industries Limited has been closed for operations and put up for sale.

Mr Kumar said the workers had not only received all outstanding wages and entitlements but received an attractive redundancy package.

“Being a Government-owned entity we have a social responsibility towards our workers but we could not continue to pour in money into a venture that had no future.

“Our other shareholder is Fiji Pine Trust whose beneficiaries are our Pine landowners.

“Fiji Forest Industries was never established as part of the Pine Industry.”

Tropik Wood Industries Limited spent $4.5m in FFI’s closure, which included $3m towards the redundancy package and an additional $1.5m for settling all the dues to external parties.

Around 220 workers were given redundancy packages with the highest payout of $54,000 to an employee.

“Post closure of operations in May of this year, we called for tenders for the sale of assets, mainly factory machinery.

“Successful bidders have dismantled and removed these machinery.”

The Malau property is on lease area of 50.64 hectares or 125 acres (Native Lease of 99 years effective from January 1, 1976).

Feedbackcharles.chambers@fijisun.com.fj

Fijisun E-edition
Tanoa Waterfront Lautoka Fiji
Subscribe-to-Newspaper
Fiji Sun Instagram
Fiji Plus
Subscribe-to-Newspaper
error: