Price Tag for Ft. St. James Mill Announced

Tuesday, February 12, 2008 12:52 PM

Prince George, - Pope & Talbot, Inc. has announced that it has agreed to sell its Fort St. James and Midway sawmills. The Sinar Mas Group has agreed to purchase the Fort St. James Sawmill for approximately $6 million. Fox Lumber Sales, Inc. has agreed to purchase the Midway Sawmill for approximately $750,000.

The sales are subject to approval by the US Bankruptcy Court and the Canadian Court, as well as customary regulatory approvals in Canada and the United States, and Pope & Talbot expects to receive such approvals and close the transactions in the second quarter of 2008.

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Posted on Tuesday, February 12, 2008 12:52 PM in News by 250 News

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Comments

Posted by: Andyfreeze on February 12 2008 12:59 PM

An absolute bargin on the FSJames mill!
Now what remains to be seen,is what they actually DO with it!
Start'er up!

Posted by: Robin Hood on February 12 2008 1:25 PM

More than just a bargain I would say. APP picked it up for about 15% of what P&T shelled out.

Now, with everything sold, what's left for the unsecured creditors? Is there even enough to cover the secured creditors?

Posted by: realitysetsin on February 12 2008 2:15 PM

Andy,

Consider that the FSJ mill just sitting there doing nothing is costing around $600 grand a month. Most so called experts expect the lumber market to be in the tank until at least mid 2009. So that's 18 months of losses, or about 11 million bucks.

If they choose to run it, their losses would be even more.

17 million is still probably a good deal for the purchaser in the long run but it's a long way from the $6 million up front.

Posted by: bwchristie on February 12 2008 2:29 PM

I think the total for everything sold is around $201 million and P & T owe at least $336 million to secured creditors
(Figures from the Portland Business Journal) The Bank of New York Trust Co. is holds about $135 million in unsecured P & T bonds so I guess they're going to be left holding an empty bag like a lot of others. By the way, Sinar Mas defaulted on millions in loans about 7 years ago.

Posted by: Andyfreeze on February 12 2008 10:17 PM

My guess for actual start-up on the FSJ mill will be early to mid July, depending on how break-up and the lumber market goes.
Wish it was a lot sooner,but logic says it won't happen that way.
It would be nice to be wrong!