Having seen interest in Gunns's pulp mill project as a standalone asset, Gunns receiver seeks to sell permit for its construction, now that New Forests plans to buy Gunns's timber assets in Tasmania; some timber could be sourced from mainland Australia
April 29, 2014
– Receivership: KordaMentha is trying to sell the pulp mill licence of bankrupt Tasmanian timber company Gunns.
The Gunns receiver is reaching out to bidders who may want to build a mill on a 650ha site that has access to the sea via the port of Tamar in the north of the state.
At least one of the final six Gunns bidders sought just to buy the pulp mill licence and there were other companies that showed interest in the pulp mill as a stand-alone asset.
To construct a pulp mill would cost as much as $2 billion, analysts estimate. Some of the timber the mill could need could be sourced from mainland Australia. Last week, investment company NewForests agreed to pay $330 million for Gunns timber assets, 175,680 gross hectares of freehold land incorporating 96,850ha of hardwood eucalyptus and 3780ha of softwood radiata pine.
New Forests is not willing to negotiate an off-take agreement with any potential buyer of its timber until its closes the Gunns deal, which may take as long as three months.
Before the sale is complete there will be an application to the Supreme Court of Tasmania to approve the sale of 50,000ha of Gunns timber assets that were part of managed investment schemes that collapsed two years ago.Gunns went into receivership in September 2012. Secured lenders were owed $445.7m, according to PPB Advisory in February last year.