9 Feb 2012

Billionaire buys into timber company

7:12 am on 9 February 2012

Australian timber company Gunns has signed an agreement with a New Zealand-born billionaire Richard Chandler in a deal that's expected to help it get the finance it needs to build a pulp mill in northern Tasmania.

The ABC reports Mr Chandler, who lives in Singapore, will pay $A150 million to obtain a 40% stake in Gunns.

Australian shareholder activist Stephen Mayne, who owns a small amount of Gunns shares, says Mr Chandler specialises in turning around struggling companies.

Gunns chief executive Greg L'Estrange expects the company will be debt free by the end of the year.

He says the Chandler investment will allow Gunns to concentrate on securing a joint venture partner for the $A2.3 billion pulp mill.