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Evergreen Forests To Call Special Meeting

16 August 2005

Evergreen Forests To Call Special Meeting

Evergreen Forests Limited announced today that a special meeting would be called to consider a bid for the company’s North Island forest estate and freehold land. These forests represent more than 90% of the company’s assets.

Chairman Peter Wilson said that major shareholders had asked to be able to consider the favoured bid arising from the contestable sale process undertaken by investment banking advisors Forsyth Barr. The sale process had been successfully completed with final offers being received from three short-listed parties who participated in due diligence.

An offer of NZ$104 million from James Fielding Funds Management Limited, as Trustee for the New Zealand Sustainable Investments Fund 1, was selected as the preferred offer. James Fielding Funds Management Limited is an Australian investment company and is a wholly owned subsidiary of the Mirvac Group. Shareholders will be invited to consider this offer at a special meeting expected to be held mid September.

The sale to James Fielding Funds Management Limited is conditional on: * Evergreen shareholder approval by way of a special resolution (approval by a majority of 75% of the votes cast on the resolution); * The purchaser obtaining approval of its principal unit holders to the form and content of its debt financing documentation; and * Overseas Investment Commission approval.

The financing documentation condition must be satisfied prior to the shareholder meeting. A market announcement will be made as and when contract conditions are satisfied.

If shareholders support an asset sale then Evergreen would propose to distribute the net proceeds of sale to shareholders with an initial distribution by year- end. Further distributions will follow the sale of remaining forest assets and conclusion of the warranty period and release of the retention. Current estimates suggest this sale and proceeds from realisation of remaining assets will yield a range of 28c to 31c per share.

Mr Wilson noted that if shareholders do not support the offer, then as previously advised, the company would undertake a rights issue to raise approximately $20 million with the proceeds applied, together with cash on hand, to repay bank debt.

Further particulars of the offer will be provided in the Notice of Meeting. This notice is expected to be provided to shareholders in early September.


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