Conifex believes that the coordinated harvesting operations will enhance fibre optimization between the two companies, improve supply chain efficiencies, and contribute to more stable harvest levels in the Mackenzie Timber Supply Area.
Conifex also believes that this innovative arrangement with Dunkley can provide additional volumes of affordable feedstock to its power generation unit at Mackenzie through increased utilization of lower quality wood and harvest residuals.
Pursuant to the agreement, Dunkley paid Conifex $20 million to acquire half of the shares of a Conifex subsidiary which holds a forest licence having a 300,000 cubic metre annual harvest of timber.
Conifex intends to use the net proceeds from the transaction to repay indebtedness, augment working capital and fund high-return capital projects at its BC harvesting and manufacturing operations.
Conifex and its subsidiaries' primary business currently includes timber harvesting, reforestation, forest management, sawmilling logs into lumber and wood chips, and value added lumber finishing and distribution.
