Tasmanian timber company Gunns has acquired ITC Timber Pty Ltd, a subsidiary of Elders Limited. The $100 million investment will be funded via a $145 million equity raising scheme, structured as a fully underwritten one-for-four non-renounceable pro-rata entitlement offer. Shares in the scheme will be offered at 90 cents per share. Gunns stock opened on the Australian Securities Exchange at $1.14 this morning. Gunns told the ASX that the acquisition included two manufacturing locations in Victoria and two in Tasmania, a sales base throughout Australia and a 50 per cent stake in Smartfibre, a joint venture with fellow Launceston-based company Forest Enterprises Australia. … In the release to the ASX, Gunns also announced a $56.2 million full-year profit, down almost five per cent on the previous year. But, it did not provide an insight into the progress of its discussions with a joint venture partner or financier for its $2.2 billion pulp mill – other than to say negotiations were “continuing positively”. Read more here

Last week’s AAP report …

By Paul Carter

HOBART, Aug 28 AAP – Gunns Ltd has been granted a trading halt,

pending an announcement to the Australian stock exchange.

“Gunns is having discussions with a party concerning a possible

acquisition and may conclude negotiations, which may potentially

lead to an agreement, shortly,” says a Gunns statement to the ASX.

Gunns proposes to release it annual results at the same as the

announcement concerning the acquisition.

Trading in the timber and paper mill giant’s shares will resume

on Tuesday.

Gunns was notified in July that it is the preferred provider of

a second hardwood woodchip facility at the Victorian Port of


Contractual arrangements for Portland involved the design of a

new facility there.

Construction is expected to start by the end of the year.

Gunns proposes to fund and operate the new facility.

Chief executive Greg L’Estrange said in July that the new

facility will provide much needed additional capacity at the port

to handle the region’s plantation grown blue gum hardwood chips.

The port authority expects the new facility to be handling more

than three million tonnes of plantation grown hardwood chips from


Currently the port can handle only a quarter of this volume.

AAP pc/cjb