General Grower Information

Who is acting in the interests of Growers?

Grower's sandalwood interests in TFS/Quintis are held in a complex legal structure known as a managed investment scheme (MIS) regulated by ASIC under the Corporations Act.  

The Responsible Entity of an MIS is the legal entity responsible for acting for growers and managing the plantations in accordance with a scheme constitution.  

For those projects where the current Responsible Entity is Sandalwood Properties Ltd (100% owned by Quintis Ltd) this raises a conflict of interest that may not be in the best interests of growers.

Sandalwood Growers is concerned that Quintis is not able to manage growers’ interests for growers' benefit due to their incompetence and conflict of interest. 

Analysis of current situation with Quintis*:

Quintis was recapitalised in 2018 and is majority foreign owned by Black Rock the US fund manager who took over the company through its debt position (estimated at more than $500m). As a private company it does not have the same reporting obligations as a public company. Depending on its unpublicised debt arrangements it is unlikely to pay tax in Australia for a very long time unlike the growers who will normally be liable to pay income tax on every dollar earned.

The Directors of Quintis include several insolvency practitioners and a public relations representative all appointed by its foreign owners. They do not personally hold any significant interests in sandalwood plantations and they are not known to have any prior experience in the sandalwood industry.

* current at 28/2/19

Who can give advice to growers?

Interests in MIS are financial products for purposes of Australian law and it is important to know who is your licensed financial adviser. Only a licensed financial adviser can give you financial advice and the Sandalwood Growers Committee cannot give financial or legal advice.  It may be a good idea for your financial adviser to register so they can be kept informed and up to date on the actions of Sandalwood Growers. 

History of MIS - what it means for sandalwood growers

  • Managed Investment Scheme (MIS) growers in Timbercorp, Great Southern and others lost hundreds of millions of dollars

  • Growers who were unable to protect their investment lost everything but their loans were still payable ending in financial ruin or bankruptcy

  • MIS is a complex structure and poorly understood - but growers have a large number of rights

  • Recent media has shown Quintis is financially vulnerable and has large liabilities of $555m approx. which exceeds its market capitalisation by some margin

ASIC's role

ASIC were not able to prevent the losses in previous failed MIS projects.  ASIC will be useful to oversee developments.  Sandalwood Growers has informed ASIC of many concerns regarding the actions of the Quintis Group and encouraged them to take necessary action on behalf of growers.

Growers need to act to protect their investment.

Costs and Funding

To date the costs have been borne by the founding Directors of the Co-op. None of the directors involved with the Co-op have been paid for their massive voluntary contributions.  The Co-op maintains sufficient funding for all of its activities.