Interfor Corporation has entered into a purchase agreement to acquire cutting rights in the Adams Lake area of the BC Interior from Canfor Corporation, as the company says in the press release received by Lesprom Network.
Interfor to acquire two replaceable licenses with annual cutting rights of approximately 349,000 cubic meters, an interest in a non-replaceable forest licence and other related forestry assets in the BC Interior that were previously associated with Canfor’s Vavenby sawmill.
Cash purchase price of $60 million, with Interfor to finance the acquisition from its available cash balance and/or borrowings under its existing bank credit facility.
In 2009, Interfor completed a four-year $140 million modernization of the Adams Lake sawmill and has since invested more than $40 million at the operation. The mill has been one of the most efficient and successful in the Interior region over the past decade.
“While business conditions in the Interior are currently challenging, we’re in the business for the longterm and believe the capacity rationalization now underway will help reset the equation going forward”, said Duncan Davies, Interfor’s President & CEO. “This transaction materially enhances Adams Lake’s log supply and sets the stage for its future success in much the same way the investments made ten years ago set the stage for its success over the last decade.”
The transaction will also provide a basis for Interfor to engage more actively with local First Nations to explore a variety of forest stewardship and partnership opportunities in the region.
Interfor is a growth-oriented lumber company with operations in Canada and the United States.
