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Weyerhaeuser sells Pine Hill CBPR plant; Linden Lumber also sold Weyerhaeuser Co. announced Monday it will sell its containerboard packaging and recycling (CBPR) business, including operations in Alabama, to International Paper for $6 billion in cash. The sale includes the Pine Hill, Ala. containerboard operation, which employs 370 people making linerboard and brown paper used for shipping boxes and other packaging. "Because the transaction is a purchase of assets rather than of stock, International Paper will realize a tax benefit that has an estimated net present value of approximately $1.4 billion," the IP news release read. "Taking this benefit into account, the net purchase price is about $4.6 billion. "…This deal represents a compelling opportunity for International Paper and our shareowners at a very attractive valuation," said Chairman and Chief Executive Officer John Faraci. "Integrating Weyerhaeuser's CBPR business into our North American packaging platform fits very well with our strategy to improve our earnings, cash flow and returns by strengthening existing businesses. We expect the combined packaging business will generate stronger cash flow and higher EBITDA margins than either standalone business." Other businesses at this site, lumber, veneer and timberlands, will remain part of Weyerhaeuser. "We are pleased with the outcome and we will continue to focus on those areas that present the greatest opportunities for the future," Rogel said. "This future begins with the trees and the land, and our outstanding stewardship of these resources. "To this we add our unique expertise in growing and extracting value from the trees and the land on which they grow. In addition, Linden Lumber Company has been bought in an agreement between the former owners and Rossi American Hardwoods of Cromwell, Conn. The new company will be called AHI Linden Lumber Company, and the deal should be closed in the next few weeks. Approximately 200 jobs will be saved through the agreement. A statement from Theodore Rossi, chief executive officer of the new company was read at the March 11 meeting of the Marengo County Commission, in which the county is being asked for a 10- year ad valorem tax abatement and a $1.5 million loan to purchase equipment for sawmill and hardwood flooring operations. The commission approved securing 80 percent of the funding for the new equipment, either through a loan from an area bank, a new bond issue or an addition to an existing bond issue, said Commissioner Ken Tucker. Without the commitment from the county, there would be "no business, no jobs," he said as Linden Lumber would have been liquidated.
The county has provided an incentive for a new company, Tucker said. A previous proposal by Linden Lumber for a $7 million loan through the county was considered simply a lifeline to an ailing company. The commission is much more comfortable with the new agreement, he said.
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