Hurdle for Heyfield mill sale

THE sale of Gunns timber mill in Heyfield faces one more hurdle before being completed, with the Victorian Supreme Court hearing the dispute on Tuesday.

The Tasmanian company is refusing to sign documents relating to the $28 million sale of the mill to the Melbourne-based Hermal Group.

In a statement to the Australian Stock Exchange, Gunns confirmed it had executed a contract for the sale of the mill, but was in dispute with Hermal over receiving adeqaute assurances that the purchase price will be paid in full when due.

Gunns expected the sale to be complete when the matter was resolved.

The sale signals Gunns’ exit from native forest supplies.

The parties would go into mediation on June 4.

The Heyfield mill has been operating at reduced capacity since Gunns last year said it would sell the operation.