Sale no solace for Mosgiel

Milton's second wind is little solace to Mosgiel workers, a union spokesman says.

Amalgamated Workers' Union spokesman Calvin Fisher said while the purchase of Southern Cross Forest Products' Milton-based sites was ''great for the people of Milton'', it was cold comfort for the workers laid off from Southern Cross' Mosgiel wood mouldings plant.

''It's great news for Milton and it's great for the region ... but for the people in Mosgiel, which is a flagship operation, sadly it's a different story,'' Mr Fisher said.

Milburn sawmill and Millstream's drymill assets will be sold by receivers KordaMentha to Pan Pac Forest Products, if the sale gains the approval of the Overseas Investment Office (OIO), creating 30 jobs at the sites.

''The opportunities for the same good-news story in Dunedin are sadly lacking,'' Mr Fisher said.

A hundred and one Otago-based Southern Cross staff were laid off progressively from mid-June after receivers KordaMentha failed to sell Southern Cross' four Otago sites as a going concern.

About 400 people were employed by the company, most of them in Otago, when it went into receivership in March.

''The workers have a right to feel let down,'' Mr Fisher said.

He still placed the blame for the company's demise at the feet of the Dunedin City Council and City Forests, which could have saved the company by negotiating long-term supply contracts at ''sustainable'' prices, he said.

However, Dunedin Mayor Dave Cull rejected the criticism when the closure of Southern Cross' Otago sites was flagged in May, saying: ''What the union is suggesting is that City Forests should take a lower price, make a lower profit, and pay a lower dividend to the ratepayers - so essentially, they are suggesting the ratepayers of Dunedin subsidise the jobs of the wider Otago sawmilling community.''

Mr Fisher said the specialist Mosgiel factory and skilled staff working at it were now lost to Otago's economy.

''It's absolutely gone,'' he said.

''The staff have gone - they have been made redundant. The machinery, the large majority ... has already gone. It's just way beyond reality [to believe the site had a future].

''This is a high-end finishing-of-product factory in Mosgiel and it's gone from our town.''

Receiver Brendon Gibson, of KordaMentha, said the assets of Southern Cross' Balclutha and Mosgiel factories, as well as the sawmilling aspect of the Millstream site, were being tendered. The land and buildings would be sold separately from the machinery. He was pleased a buyer was found for the Milton sites but ''we unfortunately haven't been able to do that for the others'', he said.

''It's been a difficult process... If we can sell these sites [Mosgiel and Balclutha], ultimately, they might offer some employment as well.''

Pan Pac Forest Products lumber general manager Michael Reaburn said the process to get the OIO's approval of the sale had begun.

OIO manager Annelies McClure said the office had not yet received an application for the sale.

The sale would probably be classified as a category 2 or category 3 application and could take up 70 working days to process, she said.

OIO approval was needed because Pan Pac Forest Products was owned by Japanese corporation Oji Holdings Corporation.

timothy.brown@odt.co.nz

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