The paper company and wide format supplier has sold the 56-hectare site of its former Wesley Vale Paper Mill near Devonport as it prepares for a shareholder vote on the company’s proposed sale later this year to Japan-based global paper giant Kokusai Pulp & Paper (KPP). The sale “looks to have scuttled" the possibility of a new jail being built at the site.
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| 226 Mill Road in Wesley Vale, Tasmania, the former Wesley Vale Paper Mill |
According to Tasmania’s The Advocate, the sale “looks to have scuttled the chances of a new jail being built at the former paper making site.” Tasmania’s state department had reportedly been interested in the site as a possible location for a new jail in Tasmania's northern half.
Spicers Limited told the ASX it was pleased to announce that its subsidiary company Tas Paper had entered into a contract to sell the land and buildings it owns at 226 Mill Road in Wesley Vale to a Launceston-based company called Tankris Pty Ltd.
"A sale price of $1.742 million has been agreed between the parties, with a deposit of $170,000 paid by Tankris on signing of the contract," Spicers said.
The site was built as a paper manufacturing facility in 1969 and operated for 40 years until operations were closed in March 2010.
With a total area of 29,891 m2, it includes a large industrial building under one roof; various industrial storage and engineering workshop buildings; an internal road network; a two-level administration building; staff canteen; clarifier; a large water reservoir; and a waste disposal infrastructure. Part of the site is planted with pine plantation timber (20.4 hectares).
The deal comes soon after Spicers, formerly PaperlinX, confirmed the sale of the remaining land that it owns at 7-15 Reeves Street in Burnie, Tasmania, to Shane and Steven Groves for $2.85 million. Last year, the company sold its Asian paper businesses to Japan Pulp & Paper company (JPP) - owner of Ball & Doggett - for $15.2m.
Despite a jump in net sales and profit, Spicers last month recorded a loss of $6.7 million for the half-year ended 31 December 2018. Net sales revenue of $158.6m was up 4.9% on the prior corresponding period (pcp), while profit after tax on continuing operations was $5.9m, “strongly up” by $4.0m or 214% on pcp, “A statutory loss after tax of $6.7m was incurred in 1H19, including a loss on sale of the Asian Operations of $15.2m,” Spicers told the ASX.
In January 2019, Spicers signed a $A147.6 million 'Scheme of Implementation' agreement to sell its entire Australia and New Zealand operations to KPP.
Spicers’ directors have unanimously recommended that shareholders vote in favour of the deal at a meeting expected to take place in June.
