Gunns assets bids to close today

BIDS for assets of failed timber company Gunns Limited - including the permits and site for its controversial Bell Bay pulp mill project - close today but it could be months before a successful buyer is known.

The assets, which also include almost 100,000 hectares of hardwood and softwood plantations, went on sale in November last year.

Gunns went into receivership in September 2012 with  secured debts of $560 million and net assets of just $24 million. 

At its height, the Launceston-based company employed nearly 2000 people at various locations throughout Australia.

Michael Smith, a spokesman for receivers KordaMentha, said potential buyers had until the close of business today to lodge their bids.

``We'll wait until tomorrow before we confirm how many we've got, but we're certainly expecting seven bids.

``We won't be able to name the bidders, we'll still be in a confidential process, (but) by the time the sale is made it's more likely the buyer will announce it rather than us,'' Mr Smith said.

KordaMentha will assess the offers - said to be from the Asia Pacific region, Europe and the Americas - and select a preferred bidder to continue negotiations. 

The  due diligence stage for a successful bidder could take three months.

It is understood that not all the bidders are interested in the pulp mill project but just want the forestry resources.

The out-going Labor government of Lara Giddings recalled parliament in February to pass legislation to validate the pulp mill permits obtained by Gunns.

At the time of its demise Gunns was one of Australia's largest forestry management companies, with about 300,000 hectares of softwood and hardwood forestry assets in Tasmania,  South Australia, Victoria and WA.

When it was appointed as receiver-managers KordaMentha blamed the failure of Gunns on the global economic downturn,  which had reduced demand and prices for export woodchips, and the collapse of the forestry Managed Investment Scheme (MIS) industry. 

Gunns shares were suspended from the ASX in early 2012 as the company failed  to attract an equity partner to restructure its operation.


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