Weyerhaeuser signs strategic deal to sell its printing papers business

SPOKANE (Scrap Monster): Weyerhaeuser Company has reached a definitive agreement to sell its printing papers business for an undisclosed amount. According to the sale agreement, the company will sell North Pacific Paper Company (NORPAC) to one of the affiliates of One Rock Capital Partners, LLC. A major portion of the proceeds after tax from the transaction will be utilized towards repayment of debts. The transaction is subject to conditions and is expected to close during last quarter of the current year. Moelis & Company was the financial advisor to Weyerhaeuser in this transaction.

Commenting on the deal, Doyle R. Simons, president and CEO of Weyerhaeuser the transaction is part of the company’s strategic review of its Cellulose Fibres business. With this deal, the company has completed the strategic review. The transaction includes the printing papers mill located in Longview, Washington, operated through a joint venture with Nippon Paper Industries Co., Ltd. Simons recollected the invaluable contributions made by NORPAC employees to the company and expected them to make similar contributions in future to One Rock in their journey ahead.

Tony W. Lee, Managing Partner of One Rock stated that its management team is excited to work with NORPAC, which is a leading provider of superior quality products in the newsprint and publication market. One Rock’s operational and strategic resources coupled with NORPAC’s reputation and market-reach will foster continued growth and profitability, said One Rock Managing Partner R. Scott Spielvogel.

During early-September, the company had announced completion of sale of its liquid packaging board business to Nippon Paper Industries Co., Ltd for $285 million in cash, in accordance with the agreement signed during June this year. The transaction had covered one mill located in Longview, Washington, with an annual capacity of 280,000 tons. The terms of the deal had covered production, processing, and sale of base paper for paper containers of liquid including soft drink and milk, and base paper for cup containers, etc. The sale had fetched nearly $225 million after tax, which was mainly used to repay outstanding debts.

Recently, Weyerhaeuser Company had announced its plans to shutdown of its lumber and plywood mills in Columbia Falls, Montana after nearly seventy years of operation. The company had cited short supply of logs as the key reason for the closure of the mills. According to them, log supplies failed to witness significant improvement, despite sincere efforts by Montana political leadership.

In May 2016, Weyerhaeuser had also announced plans to sell its pulp mills to International Paper Co. According to sources, the US Department of Justice has already concluded the regulatory review on the proposed transaction. The deal is expected to be completed during last quarter of this year. The deal covers five pulps mills located in Columbus, Miss., Flint River, Ga., New Bern, N.C., Port Wentworth, Ga., and Grande Prairie.

Weyerhaeuser is one of the world's largest private owners of timberlands. It owns or controls more than 6 million acres of timberlands, primarily in the U.S., and manages another 14 million acres under long-term licenses in Canada.

One Rock makes controlling investments in companies with potential for growth and operational improvement using a rigorous approach that utilizes highly experienced operating partners to identify, acquire and enhance businesses in select industries. One Rock also has a unique strategic relationship with Mitsubishi Corporation, which can provide strategic resources to One Rock and its portfolio companies, including access to potential new business partners, market intelligence and low-cost sourcing through increased purchasing power globally.