Timber company a going concern
ATIMBER treatment company that could piggyback even more on a surging farming sector is for sale in Manawatu.
The Ruahine Timber and Roundwood Products treatment plant, on Tangimoana Rd, produces treated poles, posts and fencing battens.
It operates as a wholesale production facility for supplying rural retail suppliers.
‘‘The company’s benefited from the rise in commodity prices as much as its customers,’’ Dave Morgan, of LINK Business Broking, says.
‘‘The run of strong prices and increased confidence in the dairy sector have encouraged farmers to catch up on their maintenance and plan for future investment.’’
Morgan says the Horizons District Sustainable Land-use Initiative (SLUI) plan, which subsidises fencing for sheep and beef farmers, has also helped to drive business.
‘‘As a result, sales have been steady through the recessionary last six years.’’
Since 2013 the company has cut its inventory of treated timber and switched its focus from treating and supplying timber to the general market to personal farming operations, small job lots on request and custom treating (for which it is Woodmark Accredited).
‘‘But demand continues for Ruahine Timber’s products and the operation could be quickly scaled up again by a motivated operator who was keen to pursue sales and re-establish supply relationships,’’ Morgan says.
‘‘All of its customers would continue to buy Ruahine Timber’s products if they were available.
‘‘Currently there is a shortage of supply and all outlets would take more treated timber if it was available.’’
Two experienced staff run the plant, which peels, gauges and treats poles and posts, cuts battens to standard fence sizing, and produces tree stakes for nurseries, with peelings, mulch, sawdust and firewood as by-products.
The business has an asking price of $280,000, including land (4.0785 hectares) and buildings, and plant and equipment; stock, forklift and loader are to be negotiated separately.
‘‘The land, buildings, plant and equipment at Tangimoana were originally part of a larger operation, which included a rural retail supply store in Feilding,’’ Morgan says.
‘‘The retail arm has recently been sold but the Tangimoana operation is still producing and continues to supply rural retailers, including the new owners of the Fielding store and several other customers and contractors.
‘‘Consequently the operation at Tangimoana is being sold for land, buildings and plant value, even though it remains a going concern.’’
There is about $35,000 worth of treated timber in stock, which is the average holding needed to sustain production.
‘‘The plant’s resource consent for tanalising is valid until 2027,’’ Morgan says, ‘‘and it would be extremely difficult to obtain all of its infrastructure, as well as its