Verda Deal Gives New Hope To NZ’s Wood Processing Industry
Verda Deal Gives New Hope To NZ’s Wood Processing
ROTORUA, Wednesday 19 March 2014: A long-awaited turnaround in the wood processing sector has been signaled today by outdoor wood specialist Verda New Zealand Ltd, who announced they are forming a new entity after a successful capital raising exercise.
Local and international investors have come together to form Verda International Ltd (VIL). VIL has purchased all of Verda New Zealand’s assets, brands and IP, and has taken a 47 per cent stake in the company’s sawmill in Napier.
VIL CEO Grant Butterworth, says the deal is the culmination of 12 months of work to form the new entity, attract new investors and finalise the company structure.
“Verda has a unique position with a high performance, engineered range of products,” Butterworth says. “Verda International Limited’s strategic goal is to be one of the premium outdoor wood product brands in high value, global markets.”
The company is currently in negotiations to take on several high profile, global architectural projects, having already collaborated with architects and landscape designers from around the world in recent years.
Butterworth says this new deal sets a platform for growth for Verda products into numerous export markets.
“Verda has invested heavily in product and new market development in recent years despite the significant impact on the wood processing and construction sectors resulting from the Global Financial Crisis.
“The investment in the new products and markets is now flowing through by way of exponential sales growth, brand equity and recognition and support from high end architects and designers in several global markets.”
Butterworth says the formation of VIL signals a turning point for New Zealand’s wood processing sector.
“Low demand for sawn timber products, the rising value of the Kiwi dollar and escalating prices for exported logs into China has made business very challenging.
“This deal is an example of how wood processing can succeed and thrive if you focus on developing your products, refining your processes and meeting your customer’s needs.”
Butterworth says the new investors represent a diverse mix of interests across the forestry, architecture, finance, building products distribution, agricultural and manufacturing sectors.
“The new equity and funding arrangements provide certainty and security for staff, suppliers and customers and will enable the huge growth potential to be realised.”
Butterworth says VIL has received strong support from Kiwibank and New Zealand Trade and Enterprise.
New Zealand Trade and Enterprise customer manager Stephen Blair says Verda’s success in attracting new investors is due to the hard work the company has put into building an international brand, understanding their market and staying focused.
“What’s special about Verda is that they really understand the difference between selling a piece of wood and building a brand,” Blair says.
“They’ve done a remarkable job – particularly in France, where soft wood is regarded as a low quality wood. They have established their soft wood products as a high quality, beautiful outdoor experience, not just a deck.”
Blair says Verda has been very persistent in tough economic times and has been focused by not tackling too many markets at once.
“If we want to get away from just exporting logs, we need more companies like Verda to create high value products. NZTE is looking forward to continuing its partnership with VIL to help and support them as they grow.”