October 6, 2023

By Lynda Kiernan-Stone, Global AgInvesting Media

Australian superannuation fund UniSuper, UK-based Pension Protection Fund (PPF), and APG Asset Management N.V (APG), on behalf of its Dutch pension fund client ABP, have acquired Forico – a 170,000-hectare hardwood forestry plantation in Tasmania, from a fund managed by New Forests. 

UniSuper is one of Australia’s largest superannuation funds, and has been managed for the benefit of the country’s higher education and research sector for 40 years, and opening the fund to all Australians in 2021. Today UniSuper invests over A$120 billion on behalf of over 615,000 members, and has a growing private markets portfolio valued at approximately A$15 billion. 

APG is the largest pension fund provider in the Netherlands, managing the pensions of 4.8 million participants in the education, government, construction, cleaning, housing associations, sheltered employment organizations, medical specialists, and architect sectors. As of July 2023, APG manages approximately EUR540 billion in pension assets. 

And, run by an independent Board and accountable to Parliament, The Pension Protection Fund (PPF) is a UK public corporation and one of the country’s largest asset owners with £33 billion in AUM, protecting nearly 10 million members belonging to more than 5,200 pension schemes.

Under the terms of the transaction, each partner will own a 33 percent stake in Forico and the forestry estate, with New Forests continuing to provide investment management services. 

“Attracting and retaining long term investment partners in UniSuper, PPF and APG helps to secure a prosperous future for Forico and the forestry industry,” said Evangelista (Ange) Albertini, CEO, Forico. “It will allow us to continue to innovate, adopt market leading practices, and look at ways to add value to the natural environment.”

A New Forests-managed entity and its co-investors initially acquired Forico in 2013 for an undisclosed amount from the Receivers of Gunns Ltd, KordaMantha. At the time, Managing Director David Brand stated that the deal made New Forests the largest forestry investor in Australia with $2.5 billion AUM.

Over the past decade, much work has been undertaken in partnership with Forico to help transform the asset into one of Australia’s top sustainable timber producers. 

The scope of the deal is enormous. Forico is the largest private forest management company in Tasmania and the forestry asset is one of the largest hardwood plantation estates by productive area in Australia, making it a key supplier of sustainable hardwood to both the domestic and international markets for end uses such as packaging and tissues. 

The estate consists of vertically integrated assets and operations spanning approximately 90,000 hectares of productive forests, another 77,000 hectares of natural forests managed for conservation, biodiversity, and cultural value, and owns key supply chain infrastructure including two wood processing mills, a seedling nursery, a fiber technology laboratory, and port access via a freehold facility located at Long Reach, Tasmania. 

“We’re delighted to be investing in an asset of this scale and quality,” said Sandra Lee, head of private markets, UniSuper. “This adds further momentum to our growing private markets and forestry portfolios, as we continue to be on the lookout for quality investments that help our members grow their retirement savings over the long term*.”

“Not only is forestry a portfolio diversifier, but it also supports the global transition towards decarbonisation through carbon storage as well as substitution to sustainable timber material,” continued Lee. “We look forward to working closely with New Forests and our co-investors as we further develop this asset.”  

Forico’s market-leading approach to valuing natural capital has been evident in their sustainability reporting demonstrating that the estate is sequestering more than 123 million tons of CO2e. Furthermore, the current plantation rotation is expected to remove from the atmosphere and sequester another 24.7 million tons before it is harvested and replanted for the next rotation.

For this work, Forico became the first forestry manager in Australia to earn FSC® Ecosystem Services certification thanks to its mission to protect biodiversity values across its estate. 

Hans-Martin Aerts, head of Infrastructure & natural resources, APG Asset Management Asia, commented, “Investing in the forestry asset class provides an opportunity to deliver strong returns for our pension fund client ABP and its participants, while contributing to sustainable development goals around climate action, improving livelihoods and sustainably managing land. We’re looking forward to our continued involvement with this market-leading vertically integrated sustainable forestry business.” 

“We have a long history with this asset in Tasmania and are delighted to bring together like-minded, long-term partners to support the future of forestry in Australia,” added Mark Rogers, CEO of New Forests and chair at Forico. “We’ll be looking at ways to add further value, harnessing the growth in the circular bioeconomy, carbon projects, natural capital and biodiversity markets.”

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

*The content put forth by Global AgInvesting News and its parent company HighQuest Partners is intended to be used and must be used for informational purposes only. All information or other material herein is not to be construed as legal, tax, investment, financial, or other advice. Global AgInvesting and HighQuest Partners are not a fiduciary in any manner, and the reader assumes the sole responsibility of evaluating the merits and risks associated with the use of any information or other content on this site.

_{*Please note past performance is not an indicator of future performance. The information provided above is of a general nature only and does not take into account your individual objectives, financial situation or needs. Consider the PDS and TMD on UniSuper’s website and your circumstances before making decisions, because we haven’t.}