Gay stepped down from the board yesterday after over 37 years with Gunns. He has worked at the company since 1973, being appointed managing director in 1986 and chairman in 2002.

In a statement, Gunns credited Gay’s “dedication and commitment” to the company.

“Gay was instrumental in the rationalisation of the Tasmanian timber industry and developing Gunns into a world-class sustainable forestry enterprise,” according to the company.

Director Chris Newman will replace Gay as chairman.The move comes at a troubled time for the company, with its share price in freefall plunge and a continuing lack of financial support for its Bell Bay pulp mill.

The Gunns share price has plunged 40% in the past 10 days, falling a 24% on Tuesday (25 May).

The price sat 29c at the time of writing, but has risen 7.5% since Gay’s retirement was announced.

Major shareholders Perpetual and Perennial Investment Partners this week began offloading their shares in Gunns, reducing their stake in the company by 3% and 2.6%, respectively.

The Bell Bay pulp mill project (pictured) also has continued to falter.

While Gunns has obtained all but one of the environmental approvals to build the mill and been given the go-ahead to begin construction by the government, it has yet to secure a financial backer.

The company had been expected to announce a financial partner for the mill over a year ago, but has struggled against the tough economic backdrop.

Earlier this year the forestry giant posted a 98.7% fall in profits in its half-year results.

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