Rayonier and PotlatchDeltic have agreed to merge in an all-stock transaction that values the combined enterprise at $8.2 billion. The deal will create a diversified land resources REIT with 4.2 million acres of timberland, including 3.2 million acres in the U.S. South and 931 thousand acres in the Pacific Northwest, according to Rayonier and PotlatchDeltic.
The combined company will become the second-largest in the sector, behind Weyerhaeuser, the top U.S. timber REIT and largest private landowner, with more than 10 million acres and a market value exceeding $17 billion.
The merger will consolidate seven wood products facilities with a total capacity of 1.2 billion board feet of lumber and 150 million square feet of plywood. The combined company expects to realize $40 million in annual run-rate synergies within 24 months, driven by operational and corporate cost efficiencies. In addition to economies of scale, the merger will expand flexibility under REIT asset and income test limitations, enhancing the ability to grow the wood products business.
Based on closing prices from October 10, 2025, the pro forma equity market capitalization is $7.1 billion, with net debt of $1.1 billion. PotlatchDeltic shareholders will receive 1.7339 Rayonier shares for each of their own, representing an implied value of $44.11 per share and an 8.25% premium. Rayonier shareholders will own 54% of the combined company, and PotlatchDeltic shareholders will own 46%.
The new entity will operate under a new name to be announced before the merger closes. The board of directors will consist of five members from each company, with Rayonier appointing the lead independent director. Mark McHugh of Rayonier will serve as CEO, and Eric Cremers of PotlatchDeltic will become Executive Chair of the board for 24 months.
In real estate, the merged company will integrate development projects at Wildlight (Florida), Heartwood (Georgia), and Chenal Valley (Arkansas), alongside ongoing rural land sales. Its real estate platform will support long-term value creation in higher-and-better-use land development. The combined REIT will also expand its position in natural climate solutions, with scale to support solar, carbon capture and storage, and voluntary carbon markets.
Rayonier declared a one-time special dividend of $1.40 per share, payable on December 12, 2025, to shareholders of record as of October 24. The dividend consists of 25% cash and 75% Rayonier shares, distributed to offset taxable gains from the company’s New Zealand divestiture. Shareholders may elect to receive cash or stock, but the cash portion will be prorated if elections exceed the aggregate 25% cap. Those who do not elect will receive the default 25/75 split. PotlatchDeltic shareholders will receive merger consideration adjusted to match the cash and stock value of this dividend.
The transaction is expected to close in late Q1 or early Q2 2026, subject to regulatory clearance and shareholder approvals from both companies.
