Rayonier announced that it intends to separate its Performance Fibers business from its Forest Resources and Real Estate businesses. Source: Woodworking Network
The separation will result in two independent publicly-traded companies by means of a tax-free spin-off of the Performance Fibers business to Rayonier shareholders.
The separation is expected to be completed in mid-2014.
“Rayonier’s board and management team continuously evaluate strategic options to best position the company to drive value for shareholders. As part of our strategic planning process, we began in-depth analysis and preparation for the business separation almost two years ago.
“With an improving US housing market, strong timber export markets, and the successful expansion of our cellulose specialties capacity, we concluded that now is the optimal time to pursue the separation of these two nonintegrated businesses,” said Paul Boynton, chairman, president and CEO.
“While these businesses have historically provided Rayonier with balance and financial strength, the company has evolved into two distinct businesses and investment opportunities,” he said.
“Accordingly, through this separation, each business will gain the flexibility to pursue its own growth strategies and operating priorities, and develop the optimal capital structure and allocation to generate long-term growth and value for shareholders.”
Rayonier has achieved important milestones to transition Performance Fibers to a specialty chemical company with an excellent foundation for long-term growth and stability.
The company has recently unlocked significant growth potential with the completion of its cellulose specialties expansion project, which increased production capacity of high-value cellulose specialties at its Jesup mill by 190,000 metric tons.
Compared with 2013, Performance Fibers is expected to sell an additional 30,000 to 50,000 metric tons of cellulose specialties in 2014 as it commences the multi-year ramp-up to full cellulose specialties production.
In its Forest Resources business, Rayonier has repositioned its portfolio to focus on core regions, including the recent sale of its New York timberlands.
It has made significant acquisitions of high quality timberlands, and owns some of the most valuable timberlands in North America and New Zealand.
