Resolute Forest Products Declares Completion of $163M Acquisition of U.S. South Sawmills

SEATTLE (Scrap Monster): Resolute Forest Products, Inc. (RFP) announced that it has completed the previously announced acquisition of three U.S. South sawmills and related assets from Conifex Timber, Inc.

The total consideration of the deal is estimated at $176 million, which includes purchase price of $163 million plus working capital of $13 million. The two companies had reached an agreement in end-December last year. The acquired mills, located in Cross City (Florida), Glenwood and El Dorado (Arkansas), have a combined production capacity of around 550 million board feet. All employees at all the three facilities will remain with the new organization.

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The transaction is expected to diversify Resolute’s lumber production. Resolute has repaid in full, the lumber segment credit facility of Conifex. The balance of the proceeds from the sale will be used for working capital and general corporate purposes. Nearly $20 million will be invested in El Dorado mill towards completion of capital upgrades.

Yves Laflamme, president and chief executive officer, RFP welcomed new employees to the company. He termed the acquisition as a right move at the right time. The acquisition adds quality assets, which in turn will provide immediate scale in the region, he added.