VANCOUVER, BC, Dec. 16, 2021 /CNW/ - Canfor Corporation (TSX:
CFP) is announcing that it has entered into an agreement with
Millar Western Forest Products Ltd. ("Millar Western") to acquire
the company's solid wood operations and associated tenure for
$420 million, including $56 million in working capital. The purchase
price represents a multiple of 3 times 2020 and 2021 average
EBITDA. Canfor expects to generate at least $25 million in annual synergies principally
related to alignment with the Company's marketing programs and
operational enhancements.
Millar Western's solid wood
operations, located in Alberta,
Canada, will add 630 million board feet of production
capacity and have access to a globally competitive, high-quality
timber supply. The assets consist of three well-capitalized
operations including two sawmill complexes in Whitecourt and Fox
Creek and the high-value, specialty Spruceland Millworks
facility in Acheson that is
dedicated to serving strategic markets and generates higher, more
stable returns.
"The acquisition of Millar
Western's solid wood operations, including the highly
successful Spruceland Millworks facility, is well aligned with
Canfor's strategy to grow and diversify our global operating
platform. We are excited to expand our Alberta operations to meet the growing demand
of our customers for high-quality and sustainable wood products,"
said Don Kayne, President & CEO,
Canfor. "We look forward to welcoming Millar Western's dedicated and skilled employees
to the Canfor team."
Canfor anticipates financing this transaction with cash and
liquidity on hand. The transaction is expected to close in the
first quarter of 2022 and is subject to customary closing
conditions including regulatory approvals.
Forward Looking Statements
Certain statements in this press release constitute
"forward-looking statements" which involve known and unknown risks,
uncertainties and other factors that may cause actual results to be
materially different from any future results, performance or
achievements expressed or implied by such statements. Words such as
"expects", "anticipates", "projects", "intends", "plans", "will",
"believes", "seeks", "estimates", "should", "may", "could", and
variations of such words and similar expressions are intended to
identify such forward-looking statements. These statements are
based on management's current expectations and beliefs and actual
events or results may differ materially. There are many factors
that could cause such actual events or results expressed or implied
by such forward-looking statements to differ materially from any
future results expressed or implied by such statements.
Forward-looking statements are based on current expectations and
Canfor assumes no obligation to update such information to reflect
later events or developments, except as required by law.
Canfor is a leading integrated forest products company based
in Vancouver, British Columbia
("BC") with interests in BC, Alberta, North and South Carolina, Alabama, Georgia, Mississippi, Arkansas and Louisiana, as well as in Sweden with 70% interest in Vida Group. Canfor
produces primarily softwood lumber and also owns a 54.8% interest
in Canfor Pulp Products Inc., which is one of the largest
global producers of market Northern Bleached Softwood Kraft Pulp
and a leading producer of high performance kraft paper. Canfor
shares are traded on The Toronto Stock Exchange under the symbol
CFP. For more information visit canfor.com.
SOURCE Canfor Corporation