Gunns will fund the purchase with the placement of 5.7 million Gunns Limited shares and a cash payment of $1.58 million to the vendors.

“The investment by Gunns recognises the strategic importance to the forest industry of further consolidation,” the company said in a statement to the ASX.

Based in Lismore and Launceston, FEA operates hardwood and softwood sawmills at Bell Bay in Tasmania.

Comment below to have your say on this story.

If you have a news story or tip-off, get in touch at editorial@sprinter.com.au.  

Sign up to the Sprinter newsletter