Seeing an opportunity to hedge against rising inflation, the Lundbeck Foundation has set its sights on Scottish woodlands, not least due to their positive carbon footprint. Over the past six months, the Foundation has made three investments and is now the proud owner of 1,661 hectares of Scottish woodland.
A 65-hectare forest area in northern Scotland has recently fallen into Danish hands. The Lundbeck Foundation has purchased the land, and for the third time in the space of 18 months the Foundation is investing in Scottish forest. Fornety Farm Wood, as the woodland is known, is the smallest of the three areas which, in total, cover 1,661 hectares.
‘Purchasing the woodlands gave us the opportunity to diversify our portfolio. We’ve had 20 years of low inflation, and if this trend doesn’t continue for ever it makes sense to have woodlands – or other long-term, inflation-proof investments – in our portfolio,’ says Bertil From, CFO of the Lundbeck Foundation.
The figures for the first year as a Scottish forestry owner indicate that, so far, the investment is living up to expectations:
‘We’ve achieved a return of almost 10% on the invested capital in less than a year. That’s considerably better than on the stock market, so we’re delighted with the investment,’ says Bertil From.
Many other benefits
The Lundbeck Foundation invests in partnership with Carsten With Thygesen through jointly owned LFI Silva Investments A/S of which he is chair. Carsten With Thygesen has expertise in the sector and was formerly CEO of HedeDanmark. He sees many advantages in the investments: financial benefits as well as benefits for the climate.
‘There is good, solid growth in woodlands in Scotland, a modern timber industry and a lack of timber in the UK. These are all factors that make forestry good business over there. The added benefit of investment in Scottish woodland is that the timber doesn’t need to be transported far to reach interested customers. This keeps both transport costs and climate impact down,’ says Carsten With Thygesen.
‘We’re also seeing a macro-trend of increasing demand for timber products, partly because it’s healthier to build with wood than, for instance, with concrete, and partly because wood is popular for its particularly aesthetic quality. On top of all that, forestry is easy on the environment. And it’s good for the climate to plant forests and use timber. Forests absorb CO2 when they grow, and this is then stored in the timber products,’ he explains.
The Lundbeck Foundation intends to purchase more land during 2019 and is currently working on a potential major acquisition.
Facts about the woodlands
Fornety Farm Wood, 22 km north of Aberdeen – 65 hectares
Bolfracks Estate, 130 km north-west of Edinburgh – 1,334 hectares
Glenauchie, 60 km south-west of Glasgow – 262 hectares
For further details please contact:
Carsten With Thygesen, tel. +45 2014 2307
Bertil From, CFO of the Lundbeck Foundation, tel. +45 2467 8167
Pernille Thorborg Jasper, Media Relations Manager at the Lundbeck Foundation, tel. +45 2118 9132