Weyerhaeuser buying MacMillan Bloedel

Pulp & Paper, Aug 1999

In a stock swap valued at $2.45 billion (C$3.6 billion), North America's fourth-- largest paper and forest products company, Weyerhaeuser Co., is buying Vancouver, B.C.-based MacMillan Bloedel Ltd. (MB), one of Canada's oldest and most venerable industry players. Once the transaction is complete, Weyerhaeuser will become second to International Paper Co. (IP) with sales of $13.3 billion. The deal is expected to be completed by the fourth quarter following approval by MB shareholders and regulators.

MB operations include 1.1 million tpy of containerboard capacity at mills in Pine Hill, Ala., Henderson, Ky., and Sturgeon Falls, Ont., and 19 converting facilities with annual capacity of 8.2 billion ft2. MB also operates three oriented strand board (OSB) plants, three plywood mills and six lumber mills and owns nearly 7 million acres of timberlands. MB sold its paper operations in 1998 with those operations now operated as Pacifica Papers Inc.

The deal should result in about $150 million in synergies, and although Weyerhaeuser said it was too early to talk about layoffs, there are no plans to close manufacturing facilities. Elimination of one of the corporate headquarters in Vancouver could result in some administrative cuts.