Jemi Fibre Corp. has entered into a letter of intent to acquire all of the issued and outstanding shares of L&M Wood Products, as the company said in the press release received by Lesprom Network.
Located in Glaslyn Saskatchewan, L&M Wood Products ("L&M") is a fully integrated wood products company focused on producing and developing value added wood products for diversified markets. The L&M facility is situated on 430 acres of land and includes:
- Saskatchewan's largest timber producing sawmill, upgraded in 2008, with an oversize head rig (optimized) saw and standard size log line;
- Post and wood treatment plant operating as Saskatchewan's largest producer of treated wood products servicing the agricultural market;
- Dowler producing high quality, value added rails;
- Firewood processor with production capacity of up to 6,000 cords per year; and
- Re-manufacturing plant with an incisor, planer, multi-rip saw, band resaw and bundle cutter, all focused on custom, on-demand products such as specialty grooved dunnage and lathe.
The purchase price for the transaction, subject to adjustments for debt balances at closing, is $16 million consisting of $5.3 million in cash, $3 million in Jemi Fibre common shares and the assumption of $7.7 million in debt. The Company has commenced its due diligence under the letter of intent and anticipates further announcements as the process continues.
Mike Jenks, Chairman & CEO, commented "This acquisition is a natural extension of our vertical integration strategy and an opportunity to add scale to our growing wood treatment division. Similar toprevious acquisitions, we anticipate applying our industry experience and harvesting capabilities to improve capacity, profitability and provide an attractive return on investment."
Jemi Fibre is a British Columbia based forest products company. Jemi Fibre's operations consist of a full service contract logging division, with operations in Mackenzie and Cranbrook, a sawmill located in Edgewater producing high value lumber products, a manufacturing facility in Cranbrook producing pressure treated posts, rails and lumber for agricultural and industrial use, and private timberlands located in the Kootenay region.