International Paper to Sell NY Forestland for $137 Million
April 11, 2006 - International Paper has signed a definitive agreement with The Lyme Timber Company for the benefit of the Lyme Forest Fund L.P. for the sale of approximately 275,000 acres of forestland in New York's Adirondack Park for approximately $137 million. The sale of forestlands is part of International Paper's previously announced transformation plan to focus on uncoated papers and industrial and consumer packaging globally. The Lyme Timber Company is a New Hampshire Limited Partnership organized in 1976 to invest in forestland and rural real estate for its own account and in partnership with other investors.
This agreement substantially completes International Paper's sales of its U.S. forestlands identified as part of the company's transformation plan. Anticipated proceeds from this and other recently announced sale agreements, totaling about 5.7 million acres, are approximately $6.6 billion. International Paper is retaining approximately 830,000 acres, some of which may be later sold to maximize the value of the land.
"With sale agreements for the bulk of our U.S. forestlands largely complete, we are well on our way to completing an important step in our plan to improve shareowner returns and strengthen our business," said International Paper Chairman and Chief Executive Officer John Faraci. "Lyme Timber's history of sustainable forestland management and experience in managing conservation easement lands will ensure these working forests continue to be protected for generations to come."
Under the terms of the agreement, Lyme Timber will continue to provide wood fiber to International Paper's Ticonderoga, N.Y., paper mill for 20 years. The forestlands will continue to be sustainably managed and third-party certified under the requirements of the Sustainable Forestry InitiativeŽ Standard.
Tom Morrow, The Lyme Forest Fund's Director of Forestland Investment, said, "The Lyme Timber Company is pleased to have reached an agreement with International Paper to buy IP's Adirondack forestlands. Lyme has a long history of forestland ownership in the Adirondacks dating back to the company's first purchase of forestland in 1976. The IP lands represent a wealth of resource values and complement Lyme's existing ownership of 84,000 acres in the northern portion of the Adirondacks. Lyme is looking forward to its role as owner and steward, understanding that these lands play a critical role in the region's wood products and recreational economies. We are committed to completing the agreements reached between IP and the State of New York to sell working forest conservation easements to the New York Department of Environmental Conservation."
In conjunction with the sale agreement, Lyme Timber will assume a 257,000-acre conservation easement agreement IP negotiated with the State of New York and The Conservation Fund in 2004. The first phase of the easement, comprising about 40,000 acres, closed late last year. The remaining phases of the easement are expected to close throughout 2006 as funds become available.
SOURCE: International Paper