Canfor to Be Canada's Top Softwood Lumber Firm
8/31/99
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Title: CANFOR to Be Canada's Top Softwood Lumber Firm
Source: Environment News Service
Status: Copyright 1999, contact source for permission to reprint
Date: August 31, 1999
VANCOUVER, British Columbia, Canada, August 31, 1999 (ENS) - Canfor
Corporation has put together a $635 million deal to acquire the shares
of Northwood Inc. from The Mead Corporation of Dayton, Ohio and Nexfor
Inc. of Toronto, Ontario.
Once the transaction is complete, Canfor says it will become the
largest Canadian producer of softwood lumber, with an annual capacity
of roughly 2.4 billion board feet. The new Canfor will also be the top
Canadian producer of kraft market pulp with a one million tonne annual
output.
"We believe that the purchase of Northwood represents an excellent
opportunity to grow the Company and create shareholder value," said
David Emerson, president and CEO of Canfor Corporation. Canfor will
assume the debt of Northwood.
Emerson said when the transaction is complete Canfor, "will be able to
improve dramatically our cost competitive position as the two
companies operate in close proximity, produce similar product lines
and share the same commitments to excellence in forest and
environmental stewardship. This makes Northwood a natural fit for
Canfor."
Northwood owns and operates a pulp mill located in Prince George, B.C.
with an annual capacity of 535,000 tonnes of kraft pulp; four
sawmills, two in Prince George, one in Houston, B.C and one in Upper
Fraser, B.C., with an annual capacity of approximately 1.1 billion
board feet; and a plywood mill located in Prince George, B.C. with an
annual capacity of 167 million square feet.
In addition, Northwood holds long-term forest tenures in the Prince
George and Prince Rupert Forest Regions with an allowable annual
harvest of 3.4 million cubic meters and has a 50 percent interest in
B.C. Chemicals Company of Prince George, B.C. Canfor owns the other
half of the company.
Since early 1998, Canfor has been refocusing its core business lines
and overhauling its profitability with a rigorous program of cost
reductions and productivity improvements. Efforts have paid off in
improved financial results. With its business fundamentals in solid
shape, the Company has been looking to grow its business and take
advantage of consolidation opportunities.
In solid wood, Canfor is the largest Canadian supplier to home center
customers like Lowes and Home Depot.
On the pulp side of the business, Canfor's northern bleached softwood
kraft pulp is acknowledged in the world market place for its premium
qualities, characteristic of the strong, thin fibres found in northern
spruce-pine-fir. Northwood draws from this same fibre base. The
combined customer base of the two companies includes some of the
world's largest paper manufacturers.
Copyright Environment News Service (ENS) 1999