Buying shares in Coillte

giftgrub

i heard a little story from a mate about buying shares in coillte (the forestry lot)

he said an an initial investment of £500 (at the time) would be worth 20 grand in 30 years

has anyone heard about this sort of thing... is it worth looking into?

DMC

No, I didnt hear that the Govt were selling Coillte off. Its a state-owned limited company, but of all the talk of the other State-owned china, like Aer Rianta or Aer Lingus, I didnt hear of any plans of folk getting into Coillte.

giftgrub

No, I didnt hear that the Govt were selling Coillte off

no its not a company sell off lioke eircom..i think you buy a plot of forest and when the trees are fully grown you get paid a dividend.

i dont know....

ToxicPaddy

I heard something like that alright, but the amounts you've said Im not so sure
about.. There are tax breaks etc to be gained from the return on your investment

Here are the details:

Coillte Investments

Tox

RainyDay

I don't think there is any option to buy shares in Coillte itself, as it is a semi-state company, fully owned by the state. If there was to be a sell-off, it would have to be done publically - couldn't be done as a sneaky deal with a selected few.

He might have been thinking about forestry investments, like those available from Irish Forestry. Personally, I'm not too keen on these investments for the following reasons;

- The highly publicised projected returns of 9% are just that - projections, aka estimates, aka a guess. There is no guarantee that you will get anything like this.
- They don't publish detailed data as to how the previous funds have done, so you've no real idea how similar kinds of investments have fared in the past.
- They are fixed term investments (10 years) - opportunities to get out earlier depend on someone else being willing to purchase your investment.
- The benefits of this investment are heavily dependant on the tax breaks currently available to forestry. Are you prepared to commit to a 10-year investment without being certain that the tax break will continue to exist for 10 years.
- The directors of the fund have a seperate company which maintains the forests, at a fixed rate per acre. To me, this is a conflict of interest. I'd expect to see the maintainance being contracted out at a competitive market rate.

See this discussion from Askaboutmoney.com for more details.

MarcusGarvey

Farmer friend told me his aul fella does a scheme with Coillte.

He gets paid 500 quid per year per plot of land(not sure is it per acre or not) that he turns into forestry. Coillte plant and maintain the trees on his land for the initial four years and he gets payment to retain it as forest for 15-20 years and then he can turn it into lumber if he sees fit.

I think that's the gist of it. What he used to do is buy ****ty pieces of land from other farmers for 3k an acre and after a few short years his investment would be payed back and after that he was making a nice profit out of land that was unsuitable for farming or building.