Shareholders overwhelmingly approve Ainsworth-Norbord merger
Norbord said combined company would have generated US$1.63 billion in sales for 12 months ended Sept. 27, 2014
TORONTO and VANCOUVER—Canadian wood product makers Norbord Inc. and Ainsworth Lumber Co. Ltd. say an overwhelming majority of both companies’ shareholder have approved their proposed $760-million merger.
The companies said 99.99 per cent of votes cast by eligible Ainsworth shareholders approved the all-share merger, while 99.46 of Norbord’s shareholders voted in favour of the deal.
The deal, which was first announced in December 2014, is subject to customary conditions to closing, including approval of the plan of arrangement by the Supreme Court of British Columbia.
Norbord said the combined company, on a pro forma basis, generated US$1.63 billion in sales and US$143 million in adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) for the 12 months ended Sept. 27, 2014.
The deal will create one of the largest and lowest-cost oriented strand board (OSB) producers in the world, according to Norbord, with a portfolio of manufacturing assets that produces a range of products for residential, industrial and specialty applications.
Norbord operates 15 plants, 11 of which produce OSB, while Ainsworth owns four production facilities.
The two companies have minimal overlap, according to Norbord, as it operates seven North American mills, principally in the southeastern United States with one mill in Quebec, along with four mills in Europe, while Ainsworth operates mills in Western Canada and Ontario.
Total OSB capacity will be approximately 7.7 billion sq.ft., Norbord said.
The company estimates the deal will create synergies of US$45 million annually.
Norbord and Ainsworth expect the deal to close by the end of the first quarter of 2015.
The combined company will operate under the Norbord name.