ARKANSAS (News release) -- Canfor Corporation is announcing that it has entered into a purchase agreement with Resolute El Dorado Inc., an affiliate of Domtar Corporation, to acquire its El Dorado lumber manufacturing facility in Union County, Arkansas. The US$73 million acquisition, including working capital, will create synergies and vertical integration opportunities given its complementary geographic fit with Canfor's existing operations in the region.
The facility, which is close to key end-markets, produces dimensional lumber and specialty wood products. Its integration will capitalize on the Company's regional manufacturing footprint to optimize product portfolio and maximize value. Leveraging Canfor's experience and expertise, and with an anticipated further $50 million in planned upgrades, production capacity is expected to increase to 175 million board feet per year.
"The El Dorado mill is an important part of the regional forest ecosystem. Together with Canfor's adjacent El Dorado Laminating Plant and nearby Urbana Plant, this acquisition aligns with our growth-focused strategy in areas with access to high-quality globally competitive timber supply," said Lee Goodloe, President, Canfor Southern Pine.
The transaction is expected to close over the next several months and is subject to customary closing conditions.
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