Interfor To Acquire Chaleur Forest Products
Interfor announced that it has reached an agreement with an affiliate of the Kilmer Group to acquire 100% of the equity interests in the entities comprising Chaleur Forest Products.
Chaleur owns two modern and well-capitalized sawmill operations located in Belledune and Bathurst, New Brunswick, with a combined annual lumber production capacity of 350 MMBF. Chaleur also operates a woodlands management division based out of Miramichi that manages approximately 30% of the total Crown forest in New Brunswick. This division provides a secure source of fiber supply for the sawmill operations as well as a stable, long-term stream of cash flow from third-party log sales, license management fees and silviculture activities.
The purchase price is $325 million Canadian, on a cash and debt free basis, which includes approximately $31 million Canadian of net working capital. In addition, Interfor will assume Chaleur’s countervailing (CV) and anti-dumping (AD) duty deposits at closing, for consideration equal to 55% of the total deposits on an after-tax basis. As of August 31, 2022, Chaleur had paid cumulative CV and AD duties of approximately $82 million USD.
“This acquisition is consistent with Interfor’s growth-focused strategy as a pure-play lumber producer and builds upon our recent expansion into Eastern Canada with further geographic diversity,” says Ian Fillinger, President & CEO. “New Brunswick has a secure, high quality and competitive log supply, a supportive investment environment and proximity to key eastern markets. These are well-managed and efficient mills with a desirable SPF product mix, which fit extraordinarily well within our existing portfolio. Chaleur’s strong management team further bolsters our core lumber strength and we look forward to welcoming the team into our company.”
On a proforma basis, Interfor’s total annual lumber production capacity will increase to 5.1 billion BF, of which 44% will be in the U.S. South, 19% in Eastern Canada, 15% in the U.S. Northwest, 15% in British Columbia and 7% in Atlantic Canada.
Interfor intends to finance the acquisition with a combination of cash on hand and its existing credit facilities. The completion of the acquisition is subject to Canadian and U.S. regulatory reviews and customary conditions for a transaction of this kind and is expected to close in the fourth quarter of 2022.
Latest News
New Pellet Mill Entices Area Sawmills
Some Georgia sawmills will have a new market for their byproducts as Spectrum Energy Georgia LLC plans to begin construction this summer of the largest industrial wood pellet facility in the world at Adel, Ga. and expects to commission the plant 12 months later, or summer of 2024. The plant will operate at the site of an idled particleboard facility. The plant will have the ability to receive and process all forms of biomass, including sawmill residues (chips, sawdust and shavings), pulpwood, top wood, and in-woods chips…
Your Tax Dollars Not At Work
Article by Rich Donnell, Editor-in-Chief, Timber Processing March 2023 –You may be aware of our affiliate magazine, Panel World, which covers the structural and non-structural wood panel industries in a similar way that Timber Processing covers the lumber industry. Recently in Panel World we ran a…
Con-Vey Promotes Joe Buck To Product Manager
Con-Vey has announced the promotion of Joe Buck from Sales Engineer to Product Manager, having been with the company for nearly four years. In his new role, Buck will lead the strategy development and execution of several products at Con-Vey, including particle board, MDF, and lumber, and will be working closely with the engineering, sales, and marketing teams. Buck’s extensive…
Find Us On Social
Newsletter
The monthly Timber Processing Industry Newsletter reaches over 4,000 mill owners and supervisors.
Subscribe/Renew
Timber Processing is delivered 10 times per year to subscribers who represent sawmill ownership, management and supervisory personnel and corporate executives. Subscriptions are FREE to qualified individuals.
Advertise
Complete the online form so we can direct you to the appropriate Sales Representative.