Tasmanian timber giant Gunns (GNS), which owns more than 60% of Auspine has launched an offer to acquire all remaining shares in the South Australian forestry company.
Gunns is offering Auspine shareholders $7 per share, representing a 13.8% premium to its previous cash bid.
Auspine managing director Adrian De Bruin, who controls 30.3% of the issued shares, has stated his intention to accept the offer for all shares he controls.
The payment would be made to shareholders within one month after they accepted the offer and no later than 21 days after the end of the offer period.
"The acquisition will establish Gunns as Australia's largest privately held diversified owner and manager of hardwood and softwood forest resources," said Gunns chief executive John Gay.
"Not only does it deliver complete control of a valuable plantation resource, it provides a significant beachhead in the mainland market and in a range of softwood structural timber product and fibre offerings to add to our very strong position in hardwood products."
"Auspine is already performing above our original expectations and we have a lot of confidence in it.''
Gunns said that if the acquisition goes ahead, it is expecting a range of strategic and financial benefits.
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.
Auspine shareholders will receive Gunns' formal offer through a bidder's statement, which is set to be dispatched to shareholders shortly
Auspine said in a statement today that upon receipt of the Gunns bid, an independent expert will review the offer.
"If that independent expert report concludes that the Gunns offer is fair and reasonable, the Auspine independent Directors would recommend Auspine shareholders accept the Gunns offer."
The offer is due to close at 7pm on January 18, 2008.
Gunns said the Auspine Target's Statement and Independent Expert's Report is expected to be sent to shareholders in December 2007.
Gunns rose by 5 cents today to close up at $3.50.
