Foresight Group is planning to raise £200m (€235m) on the London Stock Exchange for a new company that will invest in UK forestry assets.
The infrastructure and private equity manager is proposing an initial public offering and plans to sell up to 200m new shares in Foresight Sustainable Forestry Company, a newly created investment trust it has seeded with a £130m portfolio.
Foresight Group said it also has a £125m pipeline of forestry investment opportunities.
Richard Davidson, prospective chairman of Foresight Sustainable Forestry Company, said: “Forestry provides a compelling investment opportunity, meeting investor requirements on climate, sustainability and ESG issues, inflation protection properties, and portfolio diversification. Over the long term, managing a portfolio of forestry assets is generally low risk, driven by growth in both volume and value as the trees mature.”
Davidson said the company expects the significant shortfall in timber in the UK to push up timber prices in the coming years.
Bernard Fairman, executive chairman and co-founder of Foresight Group, said, for some years now Foresight has been looking to scale up its forestry investments in an appropriate structure for a wide range of investors to participate in and this London Stock Exchange-listed sustainable forestry “company launch represents the next development in that journey”.
“Forestry is a real asset, and a natural and growing store of value, independent of the economic cycle and if ever there was a time for the world to embrace investment into more trees, this is it.
“In the UK, we import the vast majority of our sawn timber requirement, a situation which is not sustainable. The UK and global economies are re-opening and demand for timber is pushing significantly ahead of supply. There is an enormous drive for us all to use more sustainable building and other products.”