The Australian Competition and Consumer Commission (ACCC) said it intends to oppose the Gunns Limited’s (GNS) proposed acquisition of ITC Timber Pty Ltd. The ACCC said the acquisition by Gunns of ITC Timber's 50% stake in the SmartFibre wood chip joint venture would likely substantially lessen competition in the market for the acquisition of hardwood pulpwood in north-eastern Tasmania.

ACCC chairman, Graeme Samuel, said extensive enquiries indicated that suppliers of hardwood pulpwood in north-eastern Tasmania would face lower prices for their timber if the proposed acquisition were allowed to proceed.

“The proposed acquisition would reduce the number of significant independent acquirers of hardwood pulpwood in the region from three to two, with the remaining competitor to the merged firm unlikely to provide an effective competitive constraint,” Mr Samuel said.

As at 1434 AEDT, Gunns shares were up 1c to 97c.