VANCOUVER, British Columbia, June 24, 2019 (GLOBE NEWSWIRE) -- Conifex Timber Inc. (“Conifex”) (CFF.TO) announced today that it has entered into a definitive purchase agreement (the "Purchase Agreement") with Hampton Lumber for the sale of its Fort St. James sawmill and associated forest license. The purchase price is approximately $39 million plus the market value of finished lumber and log inventory at closing.
Ken Shields, Conifex's Chair and CEO, stated: "“We have known for some time that lumber industry rationalization is inevitable because too little sawlog supply is available to maintain the existing manufacturing base in the Interior region of BC. The decision we have taken to sell the mill was extremely difficult; however, we are encouraged by Hampton’s plans for the site. We believe this transaction supports the Province’s objectives for industry rationalization that is mindful of the impacts on people, communities and First Nations. We sincerely thank our employees, contractors, and other stakeholders for their hard work and contribution to the site over the past decade.”
Hampton Lumber operates nine sawmills in Oregon, Washington and British Columbia, including two in the Burns Lake area of British Columbia. Hampton Lumber CEO Steve Zika commented that, “while economic conditions are extremely challenging right now for the lumber industry in British Columbia, we believe the long-term outlook for Canadian lumber is promising. We intend to build a new sawmill in Fort St. James and look forward to building relationships with local First Nations and other community partners similar to a successful joint venture we have with the Burns Lake Native Development Corporation in the Burns Lake area.”
Due to continued uncertain market conditions, Conifex does not expect to resume normal operations at the Fort St James site prior to closing of the transaction.
Closing is subject to certain regulatory approvals, including approval of the Minister of Forests, Lands, Natural Resource Operations, and Rural Development and other customary closing conditions. The proceeds of the transaction will be primarily used to retire debt and to provide additional liquidity so Conifex can better optimize performance and value at its other locations.
For further information, please contact:
|Media Contacts: |
VP Corporate Affairs and Business Development (778) 385-2750
Director of Public Affairs and Communications
Hampton Lumber, 503-203-6563
|Investor Contact: Yuri Lewis |
Chief Financial Officer
About Conifex Timber Inc.
Conifex and its subsidiaries' primary business currently includes timber harvesting, reforestation, forest management, sawmilling logs into lumber and wood chips, and value added lumber finishing and distribution. Conifex's lumber products are sold in the United States, Chinese, Canadian and Japanese markets. Conifex has expanded its operations to include bioenergy production following the commencement of commercial operations of its power generation facility at Mackenzie, BC.
About Hampton Lumber
Founded in 1942, Hampton Lumber is a fourth-generation, family-owned company based in Portland, Oregon, dedicated to providing quality wood products and responsible forestland management in the Pacific Northwest and Canada. Hampton Lumber operates nine mills throughout Oregon, Washington and British Columbia, owns roughly 140,000 acres of forestland in the U.S., and operates a wholesale business that services U.S. and international markets. Learn more at hamptonlumber.com, or follow Hampton Lumber on Facebook: @HamptonLumber.
Certain statements in this news release may constitute “forward-looking statements”. Forward-looking statements are statements that address or discuss activities, events or developments that Conifex expects or anticipates may occur in the future and include statements regarding the expected closing date of the transaction. When used in this news release, words such as “estimates”, “expects”, “plans”, “anticipates”, “projects”, “will”, “believes”, “intends” “should”, “could”, “may” and other similar terminology are intended to identify such forward-looking statements. Forward-looking statements reflect the current expectations and beliefs of Conifex's management. Because forward-looking statements involve known and unknown risks, uncertainties and other factors, actual results, performance or achievements of Conifex and its industry may be materially different from those implied by such forward-looking statements. Forward-looking statements involve significant uncertainties, should not be read as a guarantee of future performance or results, and will not necessarily be an accurate indication of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including lumber price volatility, lumber market conditions, log costs, log quality and availability and other risks described in Conifex's 2018 AIF, available on SEDAR at www.sedar.com. These risks, as well as others, could cause actual results and events to vary significantly. Accordingly, readers should exercise caution in relying upon forward-looking statements and Conifex undertakes no obligation to publicly revise them to reflect subsequent events or circumstances, except as required by law.