Forest Products Industry News
• Georgia-Pacific plans to buy Fort James in a $7.5 billion cash and stock deal that would create the world’s largest manufacturer of tissue. The combined company would have about $25 billion in annual sales.
Georgia-Pacific would divest 250,000 tons of tissue capacity to avoid potential Justice Department objections. It also would divest some commodity operations to raise cash.
Georgia-Pacific has been adding steadily to its portfolio of retail and away-from-home papers — tissues, napkins, and other products used in businesses and restaurants.
• Bowater, North America’s largest newsprint producer, will acquire the Newsprint South mill in Grenada, Miss. for $370 million in cash. Under the terms of the deal, Bowater will assume $8.9 million in debt. The mill has a production capacity of 250,000 metric tons of newsprint annually.
• Forestry workers and sawmills in northern British Columbia reached a tentative agreement on a new contract, but thousands of other workers in the coastal region still were out on strike.
A new, three-year contract between the Industrial, Wood and Allied Workers union and the northern employers’ bargaining association included raises of 2% each year.
The new agreement was similar to one that was reached earlier between the union and Canfor Corp., which bargained independently from the other northern producers.
The two new pacts should lay the groundwork for resolving disputes with other employers in the coastal and interior regions of the province, the union said.
• One-fourth of the members of the U.S. Senate have called on U.S. trade officials to negotiate for an end to Canadian subsidies to the forest products industry, according to the Coalition for Fair Lumber Imports.
In a letter to the trade officials, senators asked for a report on plans for renegotiating the U.S.-Canadian Softwood Lumber Agreement. They called for “competitive bidding for timber in Canada.”
• Enron North America Corp. plans to buy Garden State Paper Co. for $72 million. Garden State, a subsidiary of Media General, is a recycled newsprint mill in Garfield, N.J.
Enron, a global leader in electricity, natural gas and communications, launched a pulp and paper business in 1998 and provides risk management services to buyers and sellers of pulp and paper products.
• Weyerhaeuser earned an ‘Outstanding Sponsor Achievement’ award from the National Association of Resource Conservation and Development Councils. The award cited Weyerhaeuser’s Oklahoma operations for contributing to the community’s quality of life.
Weyerhaeuser has contributed to public schools, hospitals, libraries, volunteer fire departments, and more, and also donated land to wilderness areas.
• The U.S. Forest Service reversed a decision to log and burn thousands of acres in Idaho between the Lochsa River and the historic Lewis and Clark Trail. An appeal officer stopped the project because of ambiguities in the plan concerning road obliteration and the potential release of sediment into streams.
Environmentalists hailed the decision, although Forest Service officials said they would respond quickly to correct the problems and resubmit the plan.
• Three entertainers made big donations so the Sierra Club and another environmental group could post a $250,000 bond required to block logging of redwoods in Headwater Forest in California. The groups got big contributions from actor James Garner and singers Bonnie Raitt and Don Henley.
A judge had required the bond to offset income losses that may be suffered by Pacific Lumber Co., which is seeking to log about half the 1,000-acre tract.
• Plum Creek Timber Co. plans to buy the timberlands spin-off of Georgia-Pacific in a $3 billion stock transaction. The deal will make Plum Creek the second-largest owner of private timberland.
With the acquisition, Plum Creek will hold 7.9 million acres in 19 states stretching from the Pacific Northwest to the Southeast and New England. Plum Creek will remain based in Seattle.