Demerara Woods sold to English investors

DEMERARA Woods Limited (DWL) the large state-owned timber company, has been sold by government to English investors for US$16.5m. Last Saturday an agreement was signed for the sale of the assets including trade receivables and the Kingston wharf site used by DWL. According to a GPCA release yesterday the purchaser is Demerara Timbers Limited, a company recently incorporated in Guyana which is owned by two trusts administered for the benefit of Lord Beaverbrook and Mr. Rupert Galtiers-Pratt respectively.

The purchaser will assume DWL’s liabilities represented by trade payables, pensions and other employee benefits and other obligations under pending contracts. The remaining liabilities will be assumed by the State.

The arrangement includes a lease to Demerara Timbers Limited (DTL) for 5 years with a right of renewal for 2 years of the Christianburg wharf and a commitment to purchase and develop a wharf site at Charters, Demerara River, of between 20 and 100 acres and to build an access road from the Wismar- Rockstone road to the Charters site within seven years.

The overall price is US$16.5m not including lease payments or the price for the Charters site. DTL will assume possession and management immediately at its own expense. Government has the right to have a representative on the board until the completion date.

DWL has been losing money and was one of the state entities identified some time ago for divestment. The subject of considerable investment by the State and with expensive modern equipment it suffered severely from inadequate management.

The release says DTL will be embarking in a major rehabilitation and expansion programme.