Separation Transactions Implemented

AUCKLAND, 23 March, 2001 – Fletcher Challenge Limited has today completed the transactions approved by shareholders on March 6, leading to the separation of the Fletcher Challenge Group.

Trading in Fletcher Challenge Energy and Fletcher Challenge Building shares ceased on the New Zealand Stock Exchange today. From Monday, the new companies Fletcher Building (FBU) and Rubicon (RBC) will be trading on both the New Zealand and Australian stock exchanges. The application for the NYSE listing for Fletcher Building is well advanced, and trading in American Depository Shares (ADS) is also expected to commence on Monday.

Shareholders of Fletcher Challenge Energy will, from Wednesday of next week, begin to receive the cash component of the sale to Shell and Apache, as well as notification of their Rubicon shareholding (one Rubicon for each Energy share), and notification of their entitlement to Capstone Turbine shares (one Capstone entitlement for 70 Energy shares). Capstone shares are listed on the NASDAQ, and the Shell-arranged entitlements can be exchanged for shares from April 27, enabling shareholders to receive the most effective value transfer.

“I am delighted that we have been able to complete the separation of Fletcher Challenge, in response to shareholder demand, in a way that transfers real value to shareholders”, said Roderick Deane, outgoing Chairman of Fletcher Challenge. “The Paper and Energy division sales were achieved at a significant premium to market. Fletcher Challenge Forests and Fletcher Building remain as New Zealand-focused businesses. Energy’s assets in New Zealand will continue to provide jobs for New Zealanders, and Shell’s expertise and funding will enable an increased focus on high-quality exploration and production. This is a remarkable outcome from probably the most complex commercial activity ever seen in New Zealand” he said.

Fletcher Challenge Limited will be renamed as Fletcher Challenge Forests during April, and both the management and boards of the new companies will be able to focus on future strategies and performance, now that the separation process is complete, Dr Deane commented.

“Fletcher Challenge has been the employer of vast numbers of New Zealanders over many years”, said outgoing Chief Executive of the Fletcher Challenge Group, Michael Andrews, “and the skills, expertise, and energy of those employees has been an important part of New Zealand’s commercial scene. It is good to see that most of those people will continue to drive the business of the new companies, and of the assets which remain in New Zealand,” he confirmed.

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