Tasmanian Timber Giant Gunns (GNS) has finally taken formal ownership of Auspine after a long drawn out takeover battle.
Gunns already owns more than 60% of the forestry company and had offered Auspine shareholders $7 per share (US$6.15), representing a 13.8% premium to its previous cash bid
The proposal values Auspine at $330 million.
Auspine had initially recommended its shareholders reject Gunns' offer of $7 dollars a share, saying it "considerably undervalued" the company.
Nevertheless, Auspine managing director Adrian De Bruin, who controls 30.3% of the issued shares, sold all his shares to the timber giant for nearly $115 million.
He will leave Auspine next month but says hopes to return in an advisory capacity.
Auspine was reluctant to accept the too-low offer, saying on Tuesday that it had an unaudited profit after tax of 6.7 million dollars in the four months to October, compared with 2.2 million dollars a year earlier as high demand for softwood timber helped drive up prices.
"The earnings outlook for the balance of the year, based on current and forecasted production and sales, are very encouraging," said Auspine's chairman, Paul Teisseire.
But Gunns will now be reaping the benefits of this positive 2007/08 forecast as the acquisition finally puts to rest a 6 month struggle for ownership.
"The acquisition will establish Gunns as Australia's largest privately held diversified owner and manager of hardwood and softwood forest resources," said Gunns CEO, John Gay,
Gunns said it is expecting a range of strategic and financial benefits to come from the Auspine takeover.
These include geographic diversification, improved ability to invest in veneers and engineered wood products, cost saving via distribution efficiencies and attractive positioning for further expansion.
Shares in Gunns rose by 11 cents today to close up at $3.79.
