Weyerhaeuser to Buy Assets in Uruguay
June 28, 2007 - Weyerhaeuser Company has signed a letter of intent with Global Forest Partners LP (GFP) in a strategic move to focus Weyerhaeuser's international timberland investment on South America.
Under the letter of intent, Weyerhaeuser will acquire complete ownership of the Los Piques plywood mill and half of the 81,000 hectares of planted forests that Weyerhaeuser and two GFP investment funds own through separate joint ventures in Uruguay. The GFP investment funds will assume ownership of the remaining hectares from the joint ventures.
The letter of intent also affects the companies' Nelson Joint Venture in New Zealand. Under the agreement, GFP investment funds will acquire Weyerhaeuser New Zealand, Inc., and Weyerhaeuser's interest in the Nelson JV assets. These assets include approximately 67,000 productive hectares of plantation forests in the Nelson/Marlborough region and the Kaituna sawmill at Renwick, which has a log input capacity on a single shift of 80,000 cubic meters annually.
"This agreement significantly restructures our international holdings in alignment with our long-term strategic direction, simplifies our investment and management structure in Uruguay and maximizes our flexibility," said Craig D. Neeser, Weyerhaeuser senior vice president, Industrial Wood Products and International. "The New Zealand team has made outstanding contributions to our operations there and will continue to position these assets for success with GFP."
Terms of the agreement were not disclosed. The transaction is subject to the negotiation of definitive agreements and regulatory approvals.
The Nelson Forests Joint Venture had announced in February 2006 that it would explore the sale of its New Zealand assets. When that process did not result in a sale, subsequent discussions between the partners regarding their overall relationship resulted in the letter of intent announced today.
SOURCE: Weyerhaeuser Company