Canada's Paper Excellence Group has finalised the acquisition of Resolute Forest Products. "Today's acquisition creates a stronger and more resilient diversified forest products company, manufacturing a range of pulp products and specialty, printing, writing, and packaging papers, as well as lumber and tissue," Paper Excellence announced.
Resolute Forest Products is not only one of the major newsprint and uncoated magazine paper producers in Northern America. The company also produces 1.1 million t of market NBSK, NBHK, fluff and recycled bleached kraft (RBK) pulp and runs 22 facilities with 2.9 billion board feet of construction-grade lumber capacity .
Paper Excellence group considers Resolute's business as complementary to its own (Paper Excellence and Domtar) and expects the acquisition to increase the group's scale, overall product offering and geographic reach.
Under the terms of the agreement, Resolute stockholders are receiving $20.50 for each share of the Resolute common stock and one contingent value right ("CVR") per share entitling the holder to a share of potential future softwood lumber duty deposit refunds on about $500 million of deposits paid by Resolute, Paper Excellence said. Resolute common stock will be delisted from the New York Stock Exchange and the Toronto Stock Exchange.
Canada's competition authority had approved the announced takeover last December but ordered Domtar to sell its Dryden pulp mill and Resolute's Thunder Bay pulp mill to address competition concerns in certain Canadian regions. At the end of February, Domtar announced that it will divest the Dryden pulp mill to First Quality Enterprises, a US tissue and personal care products company. Domtar expects the Dryden transaction to close early in the third quarter. The deal is is subject to customary closing conditions, including regulatory approvals.