I REFER to the article, 'CEO's departure followed by Unifiber sell-down' (ST, April 22).

We disagree with the headline that there was a selldown of our stock because of the resignation of CEO Kishore Dass. On Monday last week our stock stood at 28 cents; Mr Dass' resignation was announced on Wednesday. At the close of the week our stock stood at 29.5 cents, a 5.35 per cent gain.

While it is fair to say that there might be some selling off of shares because of the CEO's resignation, it was certainly an exaggeration to call it a selldown.

From our perspective, the stock's price change and the volume traded suggest that while a minority of investors were spooked by the resignation, the majority were untroubled by the announcement.

The market is mature enough to realise that while Mr Dass was the public face of United Fiber System (UFS), it is the management team that makes the company work.

UFS has a management team with vast experience in the pulp industry. For instance, I have 35 years' experience in the pulp and paper industry. So while individuals may be missed, it is business as usual.

Your correspondent also quotes a reader, a Mr Chua, who questioned the valuation of our forest assets in South Kalimantan. Mr Chua felt that as some of the Acacia trees in the plantation were more than eight years old, they had passed their prime and therefore would depreciate.

In our forest plantations, we use Acacia mangium, which is a fast-growing plantation species that can be harvested anywhere between six and 12 years after planting.

Harvests are timed to optimise economic returns. If not harvested at that time, the trees will continue to grow for many years and will continue to be an excellent wood raw material for pulp or other end-uses.

Sven Edstrom
Chairman and Acting CEO
United Fiber System

EDITOR'S NOTE: Mr Edstrom's letter fails to highlight the fact that the company's share price fell for two straight days after Mr Dass' resignation last Wednesday. And the fall last Thursday was accompanied by a heavy volume of 22.1 million shares, which was more than double the 8.9 million shares traded daily, on average, in the month before that day.

《The Business Times》