Gresham House establishes new forestry fund

(ShareCast News) - A complex transaction was being undertaken by Gresham House on Friday, as the company announced its intention to establish a new fund for institutional, family office and professional investors, to be advised by its subsidiary Aitchesse Ltd.The AIM-traded specialist asset manager said the fund would initially acquire an attractive portfolio of forests in the west of Scotland for £12.1m, inclusive of all costs and taxes.Gresham House said the portfolio consisted of five forests with an aggregate size of 1,975 hectares (4,880 acres). It would be structured as a Scottish Limited Partnership (SLP) with a target size of £25m.Contracts to purchase the portfolio had already been entered into by Aitchesse General Partner (AGP), with a property trust controlled by an established UK Pension Scheme through the payment of a non-refundable deposit of £500,000."AGP contracting to acquire this portfolio of forests is the first major initiative since Aitchesse became part of the Gresham House group," said Gresham House Asset Management managing director Rupert Robinson."The opportunity to purchase such an attractive forestry asset as the cornerstone investment for the Fund is particularly exciting. The Fund will be Gresham House's first new collective investment vehicle investing in forestry, a growing asset class for institutional, family office and professional investors," he added.The deposit would be funded by £250,000 lent to AGP by members of the Aitchesse management team, and £250,000 from Gresham House. The directors of AGP were also directors of the Gresham House group, which includes Aitchesse Ltd, though AGP was not a subsidiary of the group.Gresham House said the new fund intended to acquire the portfolio of forests from AGP, with completion of the purchase expected on or before 31 July. AGP had exclusivity arrangements in place until that date.Aitchesse Ltd was acquired by Gresham House on 23 November 2015, and managed more than £200m in commercial forestry investments in the UK.