Kai Iwi was bought by parties related to the Manager, then later sold to Flat Rock Forests Trust at slightly less than twice the purchase price.  Was this an arms-length transaction?  Don Simcock and Anthony Francis (Tony) Hassed, formed a company called Hasim Holdings in October 94.  In November, Terranet (online) shows they put a caveat on a 512 ha parcel.  In March 95, the 512 ha was split into 3 parcels, 45B/318, 45B/319, and 45B/320.  I traced the latter 158.7942 ha parcel because, according to Terranet, only it was owned by Kai Iwi Forests Limited.

In May 95, Hasim Holdings filed a partial withdrawal of caveat.  In July, the whole caveat was withdrawn.  All on the same day, Elders Pastoral partially discharged a mortgage, ownership transferred to Beyond Challenge Limited for $110,000, then ownership transferred to Kai Iwi Forests Limited for $144,000.  In Feb 97, a mortgage to Countrywide posted.  Almost two weeks later an agreement and mortgage posted with no information given.  In March 97, another mortgage to Countrywide posted.

The full PriceWaterhouse review said the cost of bush for Kai Iwi was $95,646.  Yet FRFT’s 31 March 95 Annual Return (p. 12) said that the trust bought Kai Iwi shares for $260,000, not $95,646.  Not only that, but FRFT’s 31 March 96 annual return said Kai Iwi was 152 ha of “partly planted land” on which the planting of 54 ha had been undertaken which would need “regular care and maintenance.”

Forme valued the Kai Iwi land March 97 at $106,000, but PriceWaterhouse estimated the land would bring $200,000 in 2002.  PW said the sale value of Kai Iwi in 2002 was estimated to be $469,138.  However, they estimated the value in 1998 to be only $117,307 — less than half what FRFT paid the Manager for it in 1995.  Would the value really quadruple in only four years?  (What kind of trees could they be?)

An examination of the documents at the Companies Office showed that shares in Hasim Holdings/Kai Iwi were held by owners and employees of Gilbert Swan, Raycorp, and NZEB.  The annual return filed October 97 indicated that they had ceased to be shareholders sometime in the previous 14 months.  An unsatisfied January 97 charge was shown, but an examination of the “mortgage against the land” in the file showed it to be an unexecuted document.

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