Posted on December 31, 2018
PotlatchDeltic Corp. is selling its Del-Tin Fiber LLC business, including its medium density fiberboard (MDF) plant in El Dorado.
The buyer is Roseburg Forest Products of Springfield, OR. PotlatchDeltic said the purchase price was $92 million, consisting of $63 million in cash and assumption of $29 million of revenue bond obligations.
The companies said Friday that the sale will close in the first quarter of 2019 after required regulatory approval. The El Dorado MDF plant will continue to operate independently of Roseburg until the transaction closes.
Upon closing, the acquisition will be Roseburg's third MDF plant purchase in three years. The company acquired Pembroke MDF in eastern Ontario, Canada, in early 2018, and an MDF plant in Medford, Oregon.
"Roseburg is gradually expanding its geographic footprint in North America in high-performing markets with growth potential," Roseburg President and CEO Grady Mulbery said. "The El Dorado facility in Arkansas will allow us to leverage synergies with our existing southern composite panel plants, while delivering our successful MDF brands to a broader customer base."
“We obtained this well-positioned MDF business through our recent merger with Deltic Timber. The sale of MDF focuses our Arkansas operations on timberlands and lumber while enhancing shareholder value,” said Mike Covey, chairman and chief executive officer. PotlatchDeltic expects to use proceeds from the transaction for general purposes.
PotlatchDeltic’s Waldo sawmill and extensive South Arkansas forestry holdings are not part of the sale.
Roseburg currently produces the Arreis, Medite, Medite FR and Medex product lines. The El Dorado MDF plant was built in 1998 and features a 9-foot-wide Kusters continuous press.
"The culture of the El Dorado plant fits Roseburg well, not only from a sales and marketing standpoint, but also from structure and values perspectives," Jim Buffington, Roseburg's Business Director for Industrial Products, said. "As a company, we are committed to the composites business in North America, and look forward to welcoming the El Dorado plant and its team members to our organization."
Roseburg has other wood products businesses in the region. It manufactures particleboard and specialty panels, and thermally fused laminate panels, in Simsboro, LA. It also operates a particleboard mill in Taylorsville, MS.