Vancouver, BC--February 22--Weyerhaeuser Company reached a definitive agreement to sell its B.C. Coastal Group assets to Brascan Corporation of Toronto, Canada for approximately $1.2 billion ($970 million US), plus working capital.
Weyerhaeuser expects to complete the sale in the second quarter. The transaction is not conditional on financing, but is subject to regulatory approvals. The company expects to use the proceeds for debt repayment.
The transaction includes 258,000 hectares (635,000 acres) of private timberlands and the annual harvesting rights to 3.6 million cubic meters of public land timber. The sale also includes five softwood sawmills, with a combined annual production of 690 million board feet, and two remanufacturing facilities.
"This sale will allow Weyerhaeuser to focus on its core North American softwood lumber business, while strengthening its balance sheet," said Sandy D. McDade, President of Weyerhaeuser Company Limited.
McDade said the transaction is a good strategic move for both companies and is a sign that efforts to rebuild the Coastal forest industry are taking hold.
"Thanks to the efforts of employees and changes in provincial forest policy, a stronger, safer, more competitive forest products industry is emerging on the B.C. Coast," said McDade. "Coupled with a significantly improving investment climate in British Columbia, this enhanced competitiveness attracted the interest of Brascan."
Following the transaction, Weyerhaeuser will maintain a significant presence in Canada and British Columbia. The company will continue to employ about 7,000 Canadian employees -- producing and distributing softwood and hardwood lumber, engineered wood, oriented strand board, pulp, and fine paper -- in seven provinces.
