OSB mill sold to B.C. company

Boise Cascade Corp. and its partners in Voyageur Panel Ltd. this morning announced they have reached an agreement with Ainsworth Lumber Co. Ltd. for the purchase of the oriented strandboard (OSB) mill in Barwick.
Voyageur Panel is being purchased for about $193 million (U.S.), plus as much as $10 million more in early 2005 if average OSB prices exceed specified levels for the rest of 2004, Boise said in a press release.
Boise should realize about $90 million from the transaction, which is expected to close in the second quarter of 2004.
The Vancouver-based Ainsworth is a leading Canadian forest products company with a 50-year reputation for quality products and unsurpassed customer service, its said in a statement to shareholders posted on the Internet.
With operations in British Columbia and Alberta, it has long-term timber tenure and supply agreements that provide 90 percent of its fibre requirements.
Products manufactured by Ainsworth are marketed around the world and include OSB, lumber, specialty plywood, and veneer.
Upon completion of the acquisition of Voyageur Panel, Ainsworth will have an annual OSB capacity of two billion square feet.
“Voyageur [Panel] is an excellent fit with our engineered wood marketing strategy,” Brian Ainsworth, chair and CEO of Ainsworth Lumber Co. Ltd., said in the statement.
“This is a unique opportunity to add another high-quality, modern OSB facility to Ainsworth’s system,” he added.
“It will expand our geographic coverage, and over time, we expect to increase the plant’s operating capacity and value-added product mix.”
Ainsworth Lumber Co. Ltd. has OSB plants in Grande Prairie and Footner, Alta. as well as 100 Mile House, B.C. It also has a veneer plant in Lillooet, B.C., a plywood plant in Savona, B.C., and a finger-joined lumber plant in Abbotsford, B.C.
Voyageur Panel is a corporation whose shares are owned by Boise, Abitibi-Consolidated Inc., Northwestern Mutual, and Allstate Insurance Company, the Boise release said.
Boise owns roughly 47 percent of shares in Voyageur Panel, with Abitibi-Consolidated holding 21 percent, Northwestern Mutual 17 percent, and Allstate the remaining 15 percent.
BMO Nesbitt Burns Inc. acted as a financial advisor to the shareholders of Voyageur Panel.
Voyageur Panel began production of OSB in 1997, and has an annual capacity of 440 million sq. ft. It employs 158 people.
OSB produced there is used mainly as sheathing for exterior walls and roofs, and as floor underlayment.
In recent years, Voyageur Panel added rim board and web, for use in engineered wood products, to its product line, the Boise release said.