West Fraser Timber Co. Ltd. has entered into an agreement to acquire the operations of the Gilman Companies from the Howard Gilman Foundation and other shareholders for approximately US$430 million. The Gilman Companies are composed of six sawmills and a fingerjoint mill in Florida and Georgia as well as an administrative office in St. Marys, Ga. The transaction is anticipated to close in the third quarter.
The transaction continues a trend—that had quieted somewhat—of Canadian-based wood products corporations purchasing southern yellow pine sawmills. Counting this transaction, more than 40 SYP sawmills have sold to Canadian counterparts in the past 10 years, mostly to West Fraser, Canfor and Interfor.
The Gilman operations employ 900 and have a combined annual production capacity of 700MMBF. All of the mills produce lumber from southern yellow pine. In the 12 months ended June 30, 2017, the Gilman Companies generated EBITDA of US$67 million on estimated sales of US$330 million.
The acquisition represents a further step in West Fraser’s continuing expansion of its U.S. lumber operations. Upon completion of this transaction, West Fraser will have combined Canadian and U.S. lumber production capacity of 7.2 billion BF. Canadian capacity of spruce/pine/fir (SPF) lumber will represent 57% of capacity and U.S. capacity of southern yellow pine (SYP) lumber will represent 43% of capacity.
“This is a rare opportunity to acquire a U.S. lumber producer of a meaningful scale with high quality facilities and a culture similar to our own,” comments Ted Seraphim, West Fraser president and CEO.
“We are delighted to announce this transaction” said Mary Farrell, President of The Howard Gilman Foundation. “West Fraser is a leader in the North American forest products industry, and through them, we have found a true partner for Gilman Building Products capable of providing strategic expertise and capital to grow and modernize the business.
“The Foundation has been a proud steward of the company for nearly 20 years and believes that a combination with West Fraser will deliver long-term benefits to our loyal and long serving employees and the communities in which we operate,” comments Mary Farrell, president of The Howard Gilman Foundation.
West Fraser intends to finance the acquisition with cash on hand, available lines of credit and a new five-year $200 million credit facility to be made available in connection with the acquisition.
Annual synergies of approximately US$10 million are anticipated to be achieved within three years as a result of this transaction. The synergies are expected to be achieved through non-capital operational improvements and through implementation of best practices. The acquired mills also provide an attractive pipeline of high payback capital projects over the next three to five years, according to West Fraser.
Roseburg announced that Tony Ramm has been named Senior Vice President of Human Resources and Labor, overseeing the company’s human resources, benefits and compensation, recruitment, and environmental health and safety teams.
Article by Jessica Johnson, Senior Editor, Timber Processing January/February 2024
Some of the smartest men and women in the industry have graced the pages of this magazine—and have won the award of Timber Processing Person of the Year. They’ve all been incredibly worthy of this recognition for innovation, commitment and love of the industry they serve. Perhaps none have been quite as innovative as the introverted sawmiller from Georgia named Levi Anderson Pollard, V, whose name is on two of the patents that changed the way the sawmilling world manufactures and dries lumber (and on so many other patents as well).
Walter Jarck, whose career in the forest products industry spanned 65 years and ranged from logging machinery to engineered wood products, died January 3, surrounded by his children, in North Wilkesboro, NC. He was 92.
Carbotech Group has acquired Sawquip, a manufacturing company specializing in the design and manufacture of sawmill equipment for the primary and secondary breakdown of logs into lumber. This acquisition allows Carbotech Group to add on a new field of expertise, providing customers with innovative new solutions for lumber production. Sawquip’s innovative products include log turners and optimized log infeeds, chipping canters, twin and quad circular saw modules, as well as optimized gangs for controlled shape sawing, among others.
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