Oregon-Based Wood Products Company to Buy Canadian Rival
6/28/99
*******************************
RELAYED TEXT STARTS HERE:
Title: Oregon-based wood products company to buy Canadian rival
Source: Associated Press
Status: Copyright 1999, contact source for permission to reprint
Date: June 28, 1999
PORTLAND, Ore. (AP) - Lumber company Louisiana-Pacific Corp. plans to
buy Montreal-based Le Groupe Forex Inc., a leading rival in making a
plywood substitute used in homebuilding, for $408 million in cash.
The deal announced Monday was described by Louisiana-Pacific chief
Executive Mark Suwyn as another step in the company's plan to
establish itself as the premier building products supplier in North
America.
Both companies are leading producers of oriented strandboard, a
plywood substitute that is used for interior walls, roofs and floors.
Suwyn said the deal gives Louisiana-Pacific ``a broader platform in
our most profitable segment - one where we believe considerable growth
opportunities exist.''
The deal is subject to regulatory approval in the United States and
Canada and tender of at least 66.7 percent of outstanding Forex
shares. Forex's largest shareholder and the other members of the
controlling group of Forex have agreed to tender their shares, which
represent approximately 42.5 percent of Forex's shares. The deal is
expected to be completed by the end of the third quarter.
Forex employs about 750 people and has two sawmills and three
strandboard factories with an annual capacity of 1.6 billion square
feet.
Louisiana-Pacific employs about 10,000 people at facilities in the
United States, Canada and Ireland.
In April, the company announced plans to build four new plants in
British Columbia to make wood products from fast-growing aspen trees.
The trees are not considering prime trees for lumber production but
they can be chipped and flaked into the raw materials used in oriented
strandboard.
The plans are part of Louisiana-Pacific's effort to get out of the
pulp business and concentrate exclusively on building products.
In morning trading on the New York Stock Exchange. Louisiana-Pacific
shares were up 75 cents to $22.875 a share.