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THE YORK TIMBER ORGANISATION LIMITED - MEDIA RELEASE YORKCOR BACKS PAHARPUR IN BID FOR KOMATILAND FORESTRY PACKAGE 26 July 2002 In his address to shareholders at Yorkcor`s 87th annual general meeting held in Pretoria today, chairman Solly Tucker announced that the company would be joining forces with Paharpur Cooling Towers of India in its bid for the valuable Komatiland forestry package, 75% of which is up for privatisation. Paharpur currently enjoys reserve bidder status, advised Tucker. The company had launched legal proceedings to strike down the award of the preferred bidder on the basis of alleged improper conduct on the part of key players in the process. Since then the government has interrupted the privatisation process to determine "the import of the recent media allegations of bribery and/or corruption pertaining to the preferred bidder and the chairman of the Bid Evaluation Committee." Tucker disclosed that after consultation with Yorkcor yesterday, Paharpur responded positively to the government`s request to extend the validity period of its offer until 21 August 2002. Tucker reminded shareholders that Yorkcor has been active in the privatisation process for the state`s forestry assets in Mpumalanga and Limpopo province, now known as the Komatiland package. Yorkcor had originally teamed up with the Lisbon listed timber products group, Sonae Industries, and black empowerment group Madiba Forestry Consortium, headed by Mathews Phosa, former premier of Mpumalanga, and Nthato Motlana, currently national chairman of the South African Lumber Miller`s Association. The consortium received government approval for participation in 1999. Preferred bidder status was ultimately awarded to African Forestry Corporation which subsequently changed its name to Zama Resources. The black empowerment group which is participating in Paharpur`s initiative is Sefateng, which represents a large body of former exiles and combatants in the struggle for democracy prior to 1994. 24% of the equity has been earmarked for this influential grouping led by Sipho Mseleku. Tucker said that the Komatiland forestry package represents a crucial resource sustaining irreplaceable jobs in rural areas, whilst the precious asset itself is deteriorating in the face of so many unanswered questions. For more than seven years the sawmilling industry has been struggling, particularly with its international competitiveness, through being hamstrung by costly uncertainties concerning resource. Clearly Yorkcor had an interest in facilitating an early end to the uncertainness, said Tucker. "In recent days belated allegations have emerged in the media casting doubt on the integrity of Pahalpur`s bid. On the basis of full and frank disclosures by our new associates, we have reason to believe that there is no substance in these diversionary attempts. We do not believe that vested interests should be allowed to frustrate a legitimate outcome," said Tucker. As previously reported to shareholders, Yorkcor itself had launched litigation to enforce orders of the High Court and the Supreme Court of Appeal which underpinned its sawlog entitlements. A further cautionary announcement had been released recently to advise that negotiations were continuing to reach agreement for the amount of compensation payable for the termination of one of Yorkcor`s evergreen contracts in 2006. The government had agreed that compensation was due, with only the quantum to be determined, if not by agreement then by arbitration. Tucker said that Yorkcor`s interim report for the half-year to 30 June 2002 would be issued shortly. Ends ISSUED FOR: Yorkcor Limited CONTACT: Solly Tucker 012 804 9730 Cell: 082 579 0717 FAX NO: 012 804 8611 E-MAIL: Sol@yorkcor.co.za ISSUED BY: TISH STEWART PR ASSOCIATES CONTACT: Tish Stewart 011 325 4195 Cell: 082 443 6399 FAX NO: 011 325-4199 E-MAIL: Tish@tspr.co.za DATE: 26 July 2002 Date: 26/07/2002 02:21:34 PM Produced by the JSE SENS Department
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