Weyerhaeuser, Domtar Unite Fine Papers
FEDERAL WAY, WA—Two major players in the fine paper sector have decided to combine their businesses in a multi-billion dollar megadeal.
Weyerhaeuser Co. and Domtar Inc. have come to terms on an agreement that sees the two companies marry their respective fine paper businesses in a $3.3 billion transaction. If approved, the company would become the largest uncoated freesheet paper manufacturer in North America.
As part of the deal, Weyerhaeuser shareholders will receive 55 percent ownership in the new company, with Domtar shareholders getting 45 percent. Weyerhaeuser will also receive a $1.35 billion cash payment and will nominate a majority of the 13-member board, chaired by Weyerhaeuser adviser Harold MacKay.
Raymond Royer, Domtar president and CEO, will head the “new Domtar,” which will have about 14,000 employees, a head office in Montreal and a headquarters of operations in Fort Mill, SC.
Under the deal, Weyerhaeuser is chipping in eight paper and pulp mills based in six states and two Canadian provinces, 14 converting centers across both countries and other assets in Canada.