A comprehensive report on timber company Gunns has recommended the Tasmanian business be wound up. Sources: ABC News, ABC Rural
This week a two hour meeting of around 70 creditors voted to liquidate the collapsed Tasmanian timber firm.
Administrator PPB Advisory’s report to Gunns’ shareholders stated the decline in the woodchip market contributed to the company’s downfall, as did failed attempts to restructure the business.
The report made damning conclusions about Gunns’ plantation schemes, calling them an “onerous and significant drain on cash”.
PPB reports unsecured creditors like forest contractors are unlikely to recover their debts and the banks probably will not retrieve all of the $440 million they are owed.
However, $10 million worth of employee claims, including unpaid wages and leave and termination entitlements, are expected to be met in full.
Gunns’ creditors, including several companies in Western Australia’s south-west and Great Southern which are owed figures into the millions, will meet next week to decide whether to liquidate the company.
David Gatenby president of the Tasmanian Farmers and Graziers Association is an affected landholder with Gunns trees on his property.
He described the mood at this week’s meeting as sombre.
” I mean there’s nothing in it for the contractors, or the harvesters, the landowners, I mean right down there’s a lot of creditors affected by this and so basically the banks will probably get some money back or all their money back and the employee’s entitlements, in my understanding, will get their entitlements so the rest of us will just have to …sink, I suppose,” he said.
In the south east the Mayor of Grant, Richard Sage, said that the decision to vote to liquidate Gunns was a fait accompli.
He said the news of the liquidation of Gunns had not come as a shock, but was still disappointing.
He hoped that the majority of local creditors affected by the liquidation would be able to ride this out.
“… if you look at the businesses in the south east of South Australia that have nothing to do whatsoever with the pulp mill that was being built in Tasmania…our creditors haven’t been paid for the work they’ve been done and that’s disgusting,” said Sage.
