I looked at the Hawkins letter posted on this site and it does not surprise me that the GUNNS share price is under pressure. I too went to the company website GNS ASX and noted a recent purchase by Robin Gray who is, I believe, on the Board of this company. It appears even he is not prepared to support this company by purchasing shares under the rights issue at $1.50. He purchased 100,000 shares at $1.39 on the 8th of September, outside the guidelines issued by GUNNS. I’m glad to see that he is now over $20,000 out of pocket ...

It is nice to see that another Director of GUNNS, Cornelis A van der Kley, has similar faith to fellow Director Robin Gray in that he is not prepared to back the companies current rights issue to existing shareholders and like Mr Gray is buying at market value, way below the issue price. Never the less it is good to see he hasn’t lost as much as Mr Gray, but there is still time.

Cannot but smile at the price, and hope that every single dumbshit who voted for or has been supporting this mill owns plenty of them. Suckers!

Do I smell the institutions trying to save their bacon, buying up shares on the bell to limit the losses on their investment in GUNNS? Over 1,000,000 shares were purchased in the last half hour in the hope of shoring up the ceiling and thereby preventing the roof from falling in. Lucky they own a hardware chain

Tell ‘em they’re dreamin’.

The spin machine will be set to 150% to make this shemozzle look like anything other than a cat turd squashed into the new shag pile.

My congratulations to the board for their fine work….wish I had some super in one of the expert companies that invested so shrewdly in “Southbound Shenanigans”

Gotta love the show haven’t ya?

I’m waiting to see just how the congaline of suckholes that are Launceston’s Shadforths manage to explain away this debacle as a triumph for the company.
I agree with Cameron, I bet those board member purchases were made at the last moment in an attempt to hold up the closing price.
Does anyone know if Stephen Mayne is attending the October AGM? I do so enjoy his take on the experience.

We will now cross to Gunns minister for infomation…. Ooh yes hello people of Tasmania. I just want to say to you all my companies financial position is the strongest in all of the world. Soon we will make takeover bid of BHP and Rio Tinto. The Greenies are surrendering in their thousands and giving themselves over to my armies. Thankyou Mr Johnstone. You are now vindicated. The share price is very high despite what the Green infidels in the ASX say. Everything is just fine and very soon there will enough jobs for everyone in my beautiful plantation based pulp mill…huh huh huh huh. And of course not one tree will be cut down for my pulp mill.
Very soon I will also launch the inaugural Longreach wine festival where will we all celebrate and drink my famous tumour ridge wine.

I have a real concern, shared by others, that should Gunns’ problem finances continue ($92M in the red and the retail share issue ignored except by the faithful few)  then bankruptcy could ensue. In this case we have little doubt that a governmental buy out - most probably by Federal Labor, on the grounds of ‘Jobs Jobs’ and pushed by the CFMEU would be on the cards. This would also be defended on patriotic grounds, as saving this Tasmanian icon from foreign ownership
From there it’s a short step to implementing the pulp mill, seeing that the complaisant Tasmanian parliament has renewed the PMAA.
With the ‘nationalisation’ of various U.S. finance houses by the U.S. Treasury, the precedent has been set.
I look forward to others’ opinions.

The other scenario Mike, is that Gunns goes to the ‘breakers’. The company is bought and then broken down and sold off by component.
Forests may be sold to the likes of FEA or revert back to what they once were, public forests.
The hardware chain may become an extension of the likes of Bunnings.
No doubt there would be considerable interest in Auspine assets.
The pulp mill never eventuates in the Tamar.

The collapse of Gunns will create a new class of unemployed and the ‘anti everything’ (you have to love that!), brigade will get the blame. The greed of Gunns and its expansion in a perilous market will go largely unnoticed.

The perils of putting all your eggs into the one basket.

My concerns range more broadly than Gunns dilemma. I note the falling share prices across a swathe of Australian resource companies.

BHP Billiton and Rio Tinto contain striking parallels. Rio Tinto, having recently been the subject of a tug o’ war between China and BHP, has lost around one third of its share value. Australian resource companies have suffered a diminishing balance of trade, particularly with China, post Olympics.

Forget the red herring Olympics, the trade slump has assisted in the depreciation of the Australian dollar (now pushing 20%). Combined with the share prices, this is starting to become a 50% fire sale.

Now, I if I were a member of the Chinese government I would be asking myself, “What are the key resource industries in which to invest and when is the most financially opportune time to act?”

Agree with totally Tony except that I’m not sure that the demise of Gunns would cause anything but a short term blip on the unemployment front. All their other business enterprises would, as you say, be taken over by others and the forestry side of things has been cutting numbers for quite a while. If other companies picked up Gunns forest operations it’s quite possible that they would take a different approach which could see more employment.
Unfortunately if Gunns did go over, our oh so intelligent government and Forestry Tasmania would bend over backwards to encourage someone to continue business in the usual way.

I think it is significant that John Gay did not appear to avail himself of his own offer!

Now they want a second launch at $1.50 when the share price is currently at $1.18. Are there still enough suicidal people around?

ANYONE drove down the east tamar hiway lately,hundreds of millions of dollars of YOUR money spent on infrastructure for the pulp mill.now its telstras turn with a taxpayers mobile phone tower on the pulp mill site,a real black spot,as dave sez,the show rolls on.

I have stopped celebrating the fall in the share price and am now extremely concerned because another possible scenario withe the share price plunging ($1.06 yesterday) is that it becomes a prime target for a foreign takeover that would gain access to all the timber currently owned by/contracted to Gunns (that’s right - our timber), and the right to build the mill without needing to worry about getting finance.  There’s a lot of money floating around both China and India, both need pulp and access to cheap wood supply.  And perhaps their commitment to complying with environmental conditions after the mill is built may not be as strong as a local company - which has very little. And there is also little doubt that once the mill is up and running it won’t be closed down for environmental reasons, just told continually to ‘clean up’ which it will ignore if it chooses.

There is a bad smell coming from the ASX today (30 September).  All Ordinaries significantly down but Gunns up which is extraordinary.  Could an announcement be in the offing?  If so, the bad smell would be one of insider trading?

Post #10
http://www.abc.net.au/news/stories/2009/02/13/2490262.htm

By the way, the aluminium industry is being “rationalised” internationally from China to Australia and onto Canada. It is an industry that consumes huge amounts of energy in the smelting process.

The rumour over the years was Tassie’s little smelter used around 20-30% of the state’s Hydro energy and subsidised within the covert commercial-in-confidence agreement. This offset the higher international transport costs.

Smelters (eg steel) have been shifting into China for a few years now as evidenced by China’s increased coal consumption. BHP Billiton didn’t resist too hard as Newcastle and Wollongong steelworks disappeared.

If anyone in government is reading this thread then they may choose to be ahead of the game for once in their life. Then again, the media release declares protection of thousands of Australian jobs.

First baby step…
Rio Tinto cuts Tassie Jobs - 18 Feb
http://www.themercury.com.au/article/2009/02/17/56101_tasmania-news.html