Yorkcor - Cautionary Announcement
The York Timber Organisation Limited
[reg. no 1916/004890/06]
JSE Code: YRK
ISIN Code: ZAE000008108
("Yorkcor" or "the Group")
SASFIN Bank is authorised to announce that York Timbers Ltd ("York"), the main
operating subsidiary of Yorkcor, has received five years` notice from the
Department of Water Affairs and Forestry [`DWAF`] of termination of York`s
`evergreen` sawlog supply contract in respect of three plantations which have
supplied the group`s York Lumber sawmill near Bushbuckridge since 1970.
The Minister has expressed the opinion that the termination, effective from 1
January 2007, is in the interest of the people of South Africa. The timberlands
under contract to York are to be incorporated into a proposed conservation area
for use by South African National Parks.
The Government accepts that York is entitled to compensation to place it in at
least the same financial position as if the contract had not been cancelled. The
contract provides that the amount of the compensation shall be determined "on
the basis of the value of the York Lumber business as a going concern, enjoying
the benefits of this contract without interruption" Negotiations for the
quantification and payment of compensation in terms of the evergreen contract
are underway.
Yorkcor has developed a number of significant social upliftment programmes for
the benefit of communities in the vicinity its sawmilling operations and the of
the forests. In the negotiations with the Government, the company will give
attention to the impact of these developments upon the neighbouring communities,
as well as its employees.
Until the expiration of the contract in five years` time, York is entitled to
require adherence to normal silvicultural practices in the management of the
forest and in the supply of timber to its York Lumber sawmill.
A number of court actions over the years underpin York`s key rights. Compliance
has not always been forthcoming. Still pending are contempt proceedings at the
instance of York against the Minister and the Director General for persistent
failure to honour several Orders both of the High Court and of the Supreme Court
of Appeal. The matter is set down for hearing on 12 February 2002.
Shareholders are advised to exercise caution in when dealing their shares until
a further announce is made.
SASFIN Bank
Date: 23/10/2002 12:30:00 PM Produced by the JSE SENS Department
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