A Louisiana-Pacific wood products plant in New Limerick, Maine is pictured, Feb. 20, 2010. THE CANADIAN PRESS/AP, Michael C. York
September 04, 2013 - 5:09 PM
VANCOUVER - U.S. forestry giant Louisiana-Pacific Corp. said it plans to buy Vancouver-based Ainsworth Lumber Co. Ltd. for US$1.1 billion, according to a joint statement by the two companies late Wednesday.
Louisiana-Pacific said it will pay C$3.76 per share for all of the remaining common shares in the Canadian lumber company, resulting in an approximate 30 per cent premium over the company's closing price of C$2.89 on Sept. 3.
Shares in Ainsworth (TSX:ANS) closed up five cents, or 1.73 per cent, at $2.94 Wednesday on the Toronto Stock exchange.
Louisiana-Pacific said the deal also means it will assume all of Ainsworth's debt.
"This is an excellent transaction that makes LP more valuable for our customers and our shareholders," said Louisiana-Pacific chief executive Curt Stevens in a statement.
"Ainsworth has very high quality assets and provides us with an expanded suite of strand-based products and technologies, additional access to key international growth markets, particularly in Asia, and enhanced scale and efficiencies in North America."
The companies said the deal has "unanimous support" from Ainsworth's board of directions, and from its largest shareholder — Brookfield Asset Management — which owns 54 per cent of Ainsworth's stocks.
The deal, which requires the approval of shareholders, will be voted on in a special meeting next month. It is also subject to regulatory approvals.
According to the statement, the combined companies generated approximately US$2.5 billion in sales in the last 12 months ended June 30, on a pro forma basis.
Ainsworth is a leading Canadian manufacturer and marketer of oriented strand board, which is used in residential home construction. It has four manufacturing facilities located in Alberta, B.C. and Ontario.
News from © The Canadian Press, 2013