Atlas Holdings acquires two key West Fraser Timber pulp mills in $120m deal

In a significant move that underscores the ever-evolving dynamics of the pulp industry, West Fraser Timber Co. Ltd. has inked a definitive sale agreement with Atlas Holdings. The deal encompasses West Fraser’s Quesnel River Pulp mill located in British Columbia and its Slave Lake Pulp mill based in Alberta. Notably, Atlas is no stranger to the pulp and paper domain, boasting several businesses spread across Canada and the US.

The purchase agreement doesn’t just end with the mills. It also spans related woodlands operations, timber holdings in Alberta, and a crucial long-term fibre supply agreement dedicated to the Quesnel River Pulp facility.

Upon the deal’s finalization, operational reins for both the Quesnel River and Slave Lake pulp mills will transition to Millar Western Forest Products. This firm, boasting a legacy that stretches over a century and headquartered in Edmonton, joined the Atlas conglomerate in 2017. Millar Western’s established pulp mill operations in Alberta pave the way for a promising future for the recently acquired pulp mills.

The cash register rings to a tune of $120 million, the combined proceeds from this landmark sale.

Ray Ferris, President and CEO of West Fraser Timber, elaborated on the acquisition’s strategic underpinning, emphasizing, “This move solidifies a robust future for the two assets and their teams, aligning perfectly with West Fraser’s ambition to emerge as North America’s top wood building products entity. With Atlas Holdings and Millar Western’s profound pulp expertise, we are excited about the continued synergy, especially as a primary fibre supplier to Quesnel River Pulp.”

Echoing similar sentiments, David Anderson, Millar Western’s CEO, mentioned, “This is a significant step for the teams at Quesnel River and Slave Lake, promising a stable future. Our agenda is to pump in further investments into these top-notch mills, amplifying our product offerings in the global BCTMP market.”

Atlas Partner Neil Mahajan chimed in, celebrating Millar Western’s impressive stature in the wood products realm and expressing enthusiasm over welcoming the two new mills to the Atlas portfolio.

Concluding formalities, including customary regulatory assessments, remain pending for the deal. West Fraser is slated to roll out further updates in its forthcoming third-quarter results conference.

Offering advisory expertise, TD Securities Inc. is guiding West Fraser Timber financially, while McMillan LLP and Davies Ward Phillips & Vineberg LLP serve as legal counselors to West Fraser and Atlas, respectively.