US real-estate investment trust Weyerhaeuser to buy Longview Timber for $2.65 bn
17 June 2013
US real-estate investment trust Weyerhaeuser Co yesterday agreed to buy Longview Timber LLC from Brookfield Asset Management Inc, for $2.65 billion including debt.
The deal, which will be the third-largest forestry acquisition in North America, will see Weyerhaeuser acquire nearly 645,000 acres of timberland in Washington and Oregon from Brookfield and expand its Pacific Northwest holdings by 33 per cent to 2.6 million acres.
It will also increase the total amount of US timberlands it owns or controls to approximately 6.6 million acres.
The assets are held through a global timber fund that includes Brookfield Infrastructure Partners and institutional investors.
The Washington-based company expects to generate annual synergies of approximately $20 million within two years of closing.
Weyerhaeuser intends to raise approximately $2.45 billion in a combination of debt and equity. The company said that it has a committed senior unsecured bridge facility from Morgan Stanley.
''We believe our company is uniquely positioned to maximise the value of these timberlands,'' said Dan Fulton, Weyerhaeuser president and chief executive officer. ''The acquired timberlands are highly complementary to our existing acreage in Washington and Oregon, where we have more than 100 years of experience managing Douglas fir.
''By increasing our high-value timber holdings west of the Cascade mountain range, we will leverage our infrastructure as well as our expertise in silviculture, logistics and marketing, giving us a distinct competitive advantage both domestically and with export markets,'' he added.
Founded in 1900, New York Stock Exchange-listed Weyerhaeuser is one of the world's largest private owners of timberlands. It owns or controls more than 6 million acres of timberlands, primarily in the US, and manages another 14 million acres under long-term licenses in Canada.
Weyerhaeuser is also one of the largest manufacturers of wood and cellulose fibers products, and develops real estate, primarily as a builder of single-family homes.
In 2012, it generated sales of $7.1 billion and employed approximately 13,200 people.