ANZ credit covers Gunns debt NICK CLARK | June 30, 2011 12.00am
TIMBER firm Gunns has sought new financing because it has been unable to sell assets in time for $55 million of debt and interest repayments which are due today.
Documents lodged with the Australian Securities and Investments Commission reveal that its subsidiary Gunns Consolidated Investments Limited has a new working capital facility with a "maximum prospective liability" of up to $200 million from the ANZ Bank.
Gunns has provided as collateral the former Forest Enterprises Australia softwood sawmill it bought for $47 million in January.
The company had been hoping to sell softwood plantations in South Australia by June 30 to make the repayments. While the land was valued on Gunns' books at $254 million, a recent announcement said it would yield $107 million, was subject to the buyer getting finance, and may not settle until October 31.
Gunns has also been waiting for settlement of the sale of its Triabunna woodchip mill.
Infrastructure Minister David O'Byrne told Budget estimates hearings yesterday that a loan to proposed mill buyer Ron O'Connor had been approved by the Tasmanian Development Board.
"However, there are a number of conditions precedent on the loan," Mr O'Byrne said. "It may be the conditions may not be able to be met by the company."
Gunns, which is selling assets in a bid to fund its proposed $2.3 billion pulp mill on its own, also wants to sell its hardwood sawmills.
Unions said yesterday that 131 jobs were set to go over the next month with Gunns' closure of several hardwood sawmills.
Gunns has until August 31 to substantially start construction of the Bell Bay pulp mill or the permit lapses
GNS Price at posting:
26.5¢ Sentiment: None Disclosure: Not Held
