Interfor Corp. was higher after it announced it will acquire Eacom Timber Corp., a lumber producer with operations across Ontario and Quebec, for $490-million.
The acquisition includes seven sawmills with a combined annual spruce-pine-fir lumber production capacity of 985 million board feet; an I-Joist plant with an annual production capacity of 70 million linear feet; a remanufacturing plant with an annual production capacity of 60 million board feet and rights to access approximately 3.6 million cubic meters per year of responsibly managed and internationally certified fibre supply.
The company said the purchase price includes $120-million of net working capital. Interfor will also assume Eacom’s countervailing and anti-dumping duty deposits at closing, for consideration equal to 55 per cent of the total deposits on an after-tax basis. As of Sept. 30, Eacom had paid cumulative CV and AD duties of US$150-million.
“This transaction makes Interfor a truly North American lumber producer, with operations in all the key fibre regions on the continent, further diversifying and de-risking our operating platform and enhancing our growth potential and opportunity set,” stated CEO Ian Fillinger.