Gunns wood chip facility to be soldFriday 20 Apr 2012 Gunns is looking for a buyer for its export woodchip facility at the Port of Portland between Melbourne and Adelaide, pledging to use the proceeds to repay loans. The timber company is under increasing pressure to pay off some of its AU$580 million debt burden. Its shares remain suspended while it finalises a planned AU$400 million capital raising.'There's an orderly (sales) process happening,' a Gunns spokesperson said on Friday. The spokesperson said Gunns had originally expected that the Portland facility would be used as a transit point for woodchips from the 'green triangle' in Victoria and South Australia to be sent to feed the pulp mill in Tasmania. However, Gunns now believed that there was a sufficient source of woodchips available in Tasmania. 'So the strategic benefit of the port is now less,' the spokesperson said. Sources suggest Port of Portland will fetch at least two to three times the AU$25 million Gunns spent to construct the facility in 2009-10, implying a sale price of up to AU$75 million. About $25 million in capital expenditure is also required to expand capacity. Its location is attractive because Port of Portland is ideally positioned for export to Asia. |
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