NYSE-listed timber investment manager CatchMark Timber Trust has competed the sale of 18,063 acres of Oregon timberland to Roseburg Resources in a $100 million cash deal.
CatchMark realized a $23 million gain on the asset, known as the Bandon property, having acquired it in August 2018 for $88.8 million.
Roseburg is a privately-owned producer of particleboard, medium density fiberboard and thermally fused laminates. The company also manufactures softwood and hardwood plywood and lumber. Its timberland assets consist of more than 600,000 acres of forestry in Oregon, North Carolina and Virginia, and export wood chip terminal facility in Coos Bay, Oregon.
CatchMark chief executive Brian Davis said in a statement: “Coming off an exceptionally strong second quarter when we generated record revenues, cash from operations, and adjusted EBITDA and our second highest quarter of net income, this disposition demonstrates our ability to execute accretive capital recycling transactions and further strengthens CatchMark’s capital position.
“It also allows us to concentrate our activities in the US south where we have a very robust operations platform and see the greatest opportunity for future growth. Most of the sale proceeds will be used to pay down existing debt.”
The number of timberland assets coming onto the market has been reduced due to covid-19, as travel limitations have stopped managers from traveling to undertake due diligence, Stafford Capital Partners timberland managing partner Stephen Addicott told Agri Investor in early August.
“There’s been a good 12-18 months when there’s been very few assets coming on the market,” said Addicott, which has made co-investments more challenging for the firm’s $695 million fund.
“Opportunities on the secondaries side have remained quite strong through the covid period,” added Addicott, which he attributed to LPs needing to change their portfolio mix, switch fund manager or restructure a fund.