Industry: Forestry and lumber
On Aug. 28, 2021, GreenFirst Forest Products Inc., a business focused on sustainable forest planting and harvesting, completed a US$235 million purchase of forest and paper products assets from two subsidiaries of Rayonier Advanced Materials Inc., collectively known as RYAM.
Of the purchase price, US$195 million was paid in cash, US$34 million was paid in common shares of GreenFirst and $7.9 million was paid through the issuance of a chip offset credit note. The purchase aims to establish GreenFirst as a major player in the Canadian forest products industry.
Concurrently with the closing, a subsidiary of GreenFirst entered into a financing agreement with Blue Torch Finance LLC for US$100 million. Upon closing, GreenFirst borrowed against its existing credit facility to pay a portion of the cash purchase price, and entered into a new asset-based credit facility with the Royal Bank of Canada, as agent, for $65 million, to be used for working capital purposes.
The assets purchased by GreenFirst include six lumber mills in Ontario and in Quebec, as well as a newsprint mill in Ontario. The mills are capable of producing a large range of products for residential and commercial construction purposes and, collectively, rank as a top ten lumber producer in Canada. The purchased assets also include the rights to access 3.29 million m3 of fibre supply, a 20-year chip supply agreement with RYAM and established chip supply agreements, providing support and demand for the chips produced by the lumber operations.
In connection with the acquisition, GreenFirst Products Inc. also completed a market-defining rights offering for gross proceeds of over $167 million.
Norton Rose Fulbright Canada LLP acted as counsel for GreenFirst Forest Products Inc.
Willkie Farr & Gallagher LLP was involved with a team that included
Wachtell, Lipton, Rosen & Katz was involved with a team that included
Otterbourg P.C. was involved with a team that included