The name of the businessman is being kept a secret under a confidentiality agreement.

He is expected to turn Waterhouse Island, now only reachable through a 10-minute chartered flight or by boat, into a eco-tourism spot.

The 287ha island already boasts an airstrip, solar power, rainwater catchments, phone lines, a three-bedroom house, a guest house, a wharf and beautiful beaches.

Daily Mail Online said the island was located 2km from the mainland in the middle of the remote Bass Strait.

It is 1km wide and 4.5km long.

The freehold island has been used for sheep grazing for the past 150 years. It has mild winters and a warm summer.

Four friends bought the land 45 years ago after discovering it through an ad in a local paper’s classified section, according to Ray White Real Estate agent Ad Manton.

The island has been more of a holiday retreat for the friends and families of the owners.

In a later report by The Australian newspaper, the man who bought the island was named as Singaporean billionaire Koh Wee Meng, founder of the Fragrance Group.

He is also the developer of an opulent apartment and hotel tower in Melbourne modelled on the curvaceous shape of singer Beyonce, it said.

Koh was worth more than USD1 billion according to Forbes.

Fragrance Group bought a AUD5.5m site in Hobart last month, adding to its holdings in the city where it is developing a 296-room luxury hotel.

It has been reported that although Australia is surrounded by thousands of islands, sales of entire individual islands are few and far between. In Tasmania, it is estimated that there are over 4,000 islands and rocky outcrops, but only nine are freehold.