Forestry deals made waves in an otherwise "quiet" second quarter, PwC reported today (July 26).
Two of the biggest deals of the quarter came when Brookfield Asset Management sold Washington-based Longview Timber to Weyerhauser for US$2.65 billion, and Longview Fibre Packaging to Kapstone Kraft Paper for US$1.03 billion.
Brookfield Infrastructure also completed a sale of its B.C. coastal timberland operations for $170 million and its U.S. Pacific Northwest timberland operations for $790 million in June, to undisclosed buyers.
Brookfield purchased the assets in 2007, at a time when forestry was reeling from the 2006 U.S. housing crash.
"Private equity saw value that industry players didn't," PwC partner Scott McLean said in the report, "and they had a willingness to restructure the acquired assets in an aggressive manner that is foreign to the industry."
Analysts and industry veterans point to a sustained recovery for forestry through 2013 and 2014, as demand from China and steady growth in the U.S. housing market is expected to continue.
