Welcome!

News Feed Item

CORRECTION: International Forest Products Limited: Interfor Grows in the US Southeast

Agreement to Acquire Tolleson Lumber Company of Perry, Georgia

VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 02/09/14 -- A correction is being issued with respect to the International Forest Products Limited release that was issued February 09, 2013 at 12:00 PM ET. The footnotes have been modified. The correct document follows:

INTERNATIONAL FOREST PRODUCTS LIMITED ("Interfor" or the "Company") (TSX:IFP.A) announced today that it has reached an agreement with Ilim Timber Continental, S.A. ("Ilim Timber") to acquire Tolleson Ilim Lumber Company ("Tolleson") of Perry, Georgia, USA.

The Tolleson operations include two sawmills in Perry and Preston, Georgia, with a combined annual lumber capacity of more than 400 million board feet(2) plus a remanufacturing facility in Perry, Georgia. The Tolleson mills were recently ranked as the two lowest cost mills in a survey(3) of US southern pine sawmills. In 2013, Tolleson generated adjusted EBITDA(4) of US$37 million on sales of US$134 million.

The Tolleson mills are located within 75 miles of Interfor's operations at Thomaston and Eatonton, Georgia and will create an enhanced platform for Interfor in the US Southeast. It is estimated that the combination of Interfor and Tolleson will generate more than US$5 million in annual synergies through a combination of process optimization, enhancements in logistics and transportation and best-in-class business practices.

Furthermore, the Tolleson mill at Perry has plans underway to increase annualized lumber production by 50 million board feet, beginning in 2015, by upgrading the mill's kilns and increasing the number of operating hours at the facility.


(1) As of February 7, 2014 and based on a 20 day volume-weighted average    
share price for Interfor's Class A subordinate voting shares of C$14.95 per 
share and an exchange rate of US$0.906/C$1.00.                              
(2) Based on normal operating hours and after the effect of upgrading the   
Perry mill's kilns.                                                         
(3) Based on The Beck Group's 2012 Southern Pine Sawmills Competitive       
Assessment (dated July, 2013) including 24 sawmills located in 8 States.    
(4) Adjusted EBITDA excludes the impact of unusual and non-recurring items  
and accrued long term incentive compensation.                               

As a result of this transaction, Interfor's annual lumber production capacity will increase by almost 20% to 2.6 billion board feet, placing it in the top five lumber companies in North America. The Company's lumber platform in the US Southeast will total more than 900 million board feet post transaction, representing approximately 35% of the Company's total pro forma capacity.

Following completion, Interfor will work with Ilim Timber to evaluate the potential for various international marketing initiatives including Interfor serving as agent for Ilim Timber's European sales in North America and other potential joint opportunities in China, Japan, the Middle East and elsewhere.

"This transaction represents a significant step for Interfor," said Duncan Davies, Interfor's President and CEO. "The Tolleson mills are a great fit with our operations in the US Southeast and provide a larger footprint on which to build our presence in the region. Even more important, from a financial perspective, the transaction will be immediately accretive to Interfor."

Transaction Overview

Interfor's consideration for the Tolleson business(4) has been set at US$129.9 million in cash and retained liabilities plus 3.68 million Interfor shares.

On a pro forma basis, Ilim Timber will hold 5.5% of Interfor's outstanding shares which will be subject to customary governance provisions including standstill and lockup arrangements.

As part of the transaction, Ilim Timber will have the right to designate one nominee for election to Interfor's Board of Directors. Ilim Timber's Board nominee will be Mr. Paul Herbert, who retired recently as the Chief Executive Officer of Ilim Group, Russia's largest forestry, pulp and paper company, a joint venture between International Paper Company ("IP"), Ilim Timber's principals and other investors.

Prior to joining Ilim Group in 2007, Mr. Herbert served in a senior executive capacity with IP for more than 20 years. Mr. Herbert studied engineering at East London Polytechnic University in England and later attended Texas A&M for an EMBA.

Mr. Herbert will be appointed to Interfor's Board of Directors on the closing of the transaction and will stand for election at the Company's Annual General Meeting in May.

Rusty Wood, Tolleson's Chief Executive Officer, will remain with Interfor following the transaction in an advisory capacity on matters related to business strategy.

The transaction is structured to allow Interfor to maintain a strong capital structure that will allow it to continue to pursue additional growth initiatives. The Net Debt to Invested Capital will increase from 23% as at September 30, 2013 to approximately 33% on a pro forma basis. In conjunction with the closing of the transaction, Interfor will increase its bank operating lines by $50 million which will provide the Company with approximately $120 million of liquidity on a pro forma basis.

The completion of the transaction is subject to customary conditions and regulatory approvals including the approval of the TSX, and is expected to close in the first quarter of 2014.


(5) Including working capital of US$7.8 million.                            

FORWARD-LOOKING STATEMENTS

This release contains information and statements that are forward-looking in nature, including, but not limited to, statements containing the words "will", "plans" and "is expected" and similar expressions. Such statements involve known and unknown risks and uncertainties that may cause Interfor's actual results to be materially different from those expressed or implied by those forward-looking statements. Such risks and uncertainties include, among others: satisfaction of the conditions to the completion of the Tolleson acquisition in a timely manner, if at all, uncertainties related to the realization of the anticipated benefits of the Tolleson acquisition, general economic and business conditions, product selling prices, raw material and operating costs, changes in foreign-currency exchange rates, and other factors referenced herein and in Interfor's Annual Report and Management Information Circular available on www.sedar.com. The forward-looking information and statements contained in this report are based on Interfor's current expectations and beliefs. Readers are cautioned not to place undue reliance on forward-looking information or statements. Interfor undertakes no obligation to update such forward-looking information or statements, except where required by law.

CONFERENCE CALL

There will be a conference call on Monday, February 10, 2014 at 8:00 AM (Pacific Time)/11:00 AM (Eastern Standard Time) hosted by INTERNATIONAL FOREST PRODUCTS LIMITED for the purpose of reviewing the announcement. A presentation will be posted to the website for review during the conference call.

The dial-in numbers are 1-866-323-8540 or 416-640-5938. The conference call will also be recorded for those unable to join in for the live discussion, and will be available until February 24, 2014. The numbers to call are 1-866-245-6755 or 416-915-1035, Passcode 461225.

ABOUT INTERFOR

Interfor is a growth-oriented lumber company with operations in Canada and the United States. The Company has annual production capacity of more than 2.2 billion board feet and offers one of the most diverse lines of lumber products to customers around the world. For more information about Interfor, visit the website at www.interfor.com.

Contacts:
John A. Horning
Senior Vice President and Chief Financial Officer
(604) 328-1815

Martin L. Juravsky
Vice President, Corporate Development and Strategy
(416) 419-8163

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Internet-of-Things discussions can end up either going down the consumer gadget rabbit hole or focused on the sort of data logging that industrial manufacturers have been doing forever. However, in fact, companies today are already using IoT data both to optimize their operational technology and to improve the experience of customer interactions in novel ways. In his session at @ThingsExpo, Gordon Haff, Red Hat Technology Evangelist, will share examples from a wide range of industries – includin...
"We build IoT infrastructure products - when you have to integrate different devices, different systems and cloud you have to build an application to do that but we eliminate the need to build an application. Our products can integrate any device, any system, any cloud regardless of protocol," explained Peter Jung, Chief Product Officer at Pulzze Systems, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Keeping pace with advancements in software delivery processes and tooling is taxing even for the most proficient organizations. Point tools, platforms, open source and the increasing adoption of private and public cloud services requires strong engineering rigor – all in the face of developer demands to use the tools of choice. As Agile has settled in as a mainstream practice, now DevOps has emerged as the next wave to improve software delivery speed and output. To make DevOps work, organization...
Get deep visibility into the performance of your databases and expert advice for performance optimization and tuning. You can't get application performance without database performance. Give everyone on the team a comprehensive view of how every aspect of the system affects performance across SQL database operations, host server and OS, virtualization resources and storage I/O. Quickly find bottlenecks and troubleshoot complex problems.
Internet of @ThingsExpo has announced today that Chris Matthieu has been named tech chair of Internet of @ThingsExpo 2017 New York The 7th Internet of @ThingsExpo will take place on June 6-8, 2017, at the Javits Center in New York City, New York. Chris Matthieu is the co-founder and CTO of Octoblu, a revolutionary real-time IoT platform recently acquired by Citrix. Octoblu connects things, systems, people and clouds to a global mesh network allowing users to automate and control design flo...
"We are an all-flash array storage provider but our focus has been on VM-aware storage specifically for virtualized applications," stated Dhiraj Sehgal of Tintri in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
With 15% of enterprises adopting a hybrid IT strategy, you need to set a plan to integrate hybrid cloud throughout your infrastructure. In his session at 18th Cloud Expo, Steven Dreher, Director of Solutions Architecture at Green House Data, discussed how to plan for shifting resource requirements, overcome challenges, and implement hybrid IT alongside your existing data center assets. Highlights included anticipating workload, cost and resource calculations, integrating services on both sides...
Unless your company can spend a lot of money on new technology, re-engineering your environment and hiring a comprehensive cybersecurity team, you will most likely move to the cloud or seek external service partnerships. In his session at 18th Cloud Expo, Darren Guccione, CEO of Keeper Security, revealed what you need to know when it comes to encryption in the cloud.
"We're a cybersecurity firm that specializes in engineering security solutions both at the software and hardware level. Security cannot be an after-the-fact afterthought, which is what it's become," stated Richard Blech, Chief Executive Officer at Secure Channels, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
According to Forrester Research, every business will become either a digital predator or digital prey by 2020. To avoid demise, organizations must rapidly create new sources of value in their end-to-end customer experiences. True digital predators also must break down information and process silos and extend digital transformation initiatives to empower employees with the digital resources needed to win, serve, and retain customers.
"We are the public cloud providers. We are currently providing 50% of the resources they need for doing e-commerce business in China and we are hosting about 60% of mobile gaming in China," explained Yi Zheng, CPO and VP of Engineering at CDS Global Cloud, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
The WebRTC Summit New York, to be held June 6-8, 2017, at the Javits Center in New York City, NY, announces that its Call for Papers is now open. Topics include all aspects of improving IT delivery by eliminating waste through automated business models leveraging cloud technologies. WebRTC Summit is co-located with 20th International Cloud Expo and @ThingsExpo. WebRTC is the future of browser-to-browser communications, and continues to make inroads into the traditional, difficult, plug-in web co...
Between 2005 and 2020, data volumes will grow by a factor of 300 – enough data to stack CDs from the earth to the moon 162 times. This has come to be known as the ‘big data’ phenomenon. Unfortunately, traditional approaches to handling, storing and analyzing data aren’t adequate at this scale: they’re too costly, slow and physically cumbersome to keep up. Fortunately, in response a new breed of technology has emerged that is cheaper, faster and more scalable. Yet, in meeting these new needs they...
When it comes to cloud computing, the ability to turn massive amounts of compute cores on and off on demand sounds attractive to IT staff, who need to manage peaks and valleys in user activity. With cloud bursting, the majority of the data can stay on premises while tapping into compute from public cloud providers, reducing risk and minimizing need to move large files. In his session at 18th Cloud Expo, Scott Jeschonek, Director of Product Management at Avere Systems, discussed the IT and busin...
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, discussed how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team at D...