Palisade exits $1.3bn forestry business

The Australian firm has sold the only timberland asset in its portfolio, inherited in 2008 via a fund it acquired from Perpetual, to Canada’s Manulife.

Infrastructure fund manager Palisade Investment Partners has divested its stake in Taumata Plantations, a timberland company, to Canadian insurer Manulife.

Taumata runs forestry operations on a total forest estate of about 190,000 hectares across New Zealand. It has assets of over NZ$1.8 billion ($1.29 billion; €1.18 billion), according to Palisade. 

The Perpetual Diversified Infrastructure Fund, a vehicle managed by the eponymous Australian firm, originally purchased the Taumata stake in 2006. The interest was then transferred to Palisade when the latter acquired Perpetual’s infrastructure funds in 2008. 

It was the only timberland asset in Palisade’s portfolio, which comprises investments in the transport, energy, utilities, renewables, agri and social PPP sectors, the firm says on its website. Its sole remaining agri asset is a collection of regional livestock exchanges across Australia.

Palisade said the sale proceeds would be distributed to PDIF’s investors in November. A majority of LPs have decided to redeploy the money into the fund, according to the firm.

“We have been able to capitalise on the large volume of offshore capital looking to be invested in major unlisted assets and achieved the sale at an attractive price,” said Julian Widdup, the fund manager’s investment director, in a statement. He pointed out that Taumata is currently raking in record profits from high harvest volumes and strong timber prices. 

Palisade declined to provide further details on the transaction, and Manulife hadn’t responded to queries by press time.   

The Palisade Diversified Infrastructure Fund has a mandate to invest in mid-market infrastructure assets in Australia and New Zealand. In August, the fund acquired a stake in two car parks servicing the Gold Coast hospitals. 

As of 30 September, the yearly gross performance of the fund stood at 13.8 percent over three years and 13.9 percent over five years, Palisade said.