FEDERAL WAY, Wash. (AP) -- Weyerhaeuser Co. confirmed Monday that it plans to spin off its real estate unit, leaving it free to focus on its timber and paper products business.
The Federal Way, Washington-based company is one of the world's largest private owners of timberlands and one of the largest manufacturers of wood and cellulose fibers products. It also develops real estate, primarily as a builder of single-family homes, but it indicated last year that it was considering a sale or spinoff of this division.
Weyerhaeuser confirmed and detailed those plans on Monday.
The new company, Weyerhaeuser Real Estate Co., will combine with a subsidiary of homebuilder TRI Pointe Homes Inc. and become a subsidiary of the publicly traded company.
Weyerhaeuser did not disclose all the details of the exchange but under the proposed arrangement as it stands, shareholders will have the option to exchange some or all of their Weyerhaeuser common shares for the real estate company's shares. Those will immediately be converted into the right to receive shares of TRI Pointe stock when the deal is complete.
The agreement still needs TRI Pointe shareholder approval.
Weyerhaeuser expects that as a result of the offer, the number of its own outstanding shares will be reduced.
Shares of Weyerhaeuser added 22 cents to $30.55 in late trading following the announcement. Shares of Irvine, California-based TRI Pointe Homes added 38 cents to close at $16.98 and were unchanged after hours.
A representative for TRI Pointe could not be reached immediately for comment.