News: Gunns to acquire softwood saw mill in Tassi

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Forestry products company Gunns Ltd (ASX:GNS) has acquired the Bell Bay softwood saw mill in Tasmania for an undisclosed sum.

The facility, bought from the receiver and manager of FEA, will process both FEA and the softwood sawlog volumes from Gunns Scottsdale operations in Tassie.

Gunns says the combined facility will process approximately 450,000 tonnes of sawlog a year and is expected to generate annual revenue of $85 million.

The acquisition needs to gain approval from the Australian Competition and Consumer Commission, with an outcome of the ACCC's review into the transaction expected in the next few weeks.

Gunns also announced that it will close its Scottsdale softwood sawmill within four months, regardless of whether it acquires the FEA mill.

The company says it will work closely with its Scottsdale employees and other stakeholders to assist those who cannot be transferred to Bell Bay to either relocate or transition to other industries.

Gunns reported earnings of $28.49 million for the year to June 30, 2010.