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IP Sale

Started by Texas Ranger, April 05, 2006, 12:48:45 PM

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Texas Ranger

International Paper to Sell Most of Its Forestland

   By REUTERS
Published: April 5, 2006

The International Paper Company said yesterday that it had agreed to sell most of its United States forestland to private timberland investment firms for about $6.1 billion, furthering its plan to exit logging and focus on uncoated paper and packaging production.

The 5.1 million acres to be sold — about the size of Massachusetts — are in the southern United States and Michigan.

International Paper said it believed the deal was the largest private forestland sale in United States history.

Including sales last week to conservation groups, the company said, it has sold 85 percent of its forestlands for about $6.5 billion.

http://www.nytimes.com/2006/04/05/business/media/05paper.html
The Ranger, home of Texas Forestry

SwampDonkey

I think they have land holdings in Maine to, don't they? They have a Mill in Northern Maine at least.
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

Texas Ranger

So far they report 440,000 acres in Michigan and the rest in the south.  At an average price of $1200 per acres, again reported as the highest average on a land sale for timber purchase of this size.  One article said this was the largest timber land sale on record, if you discount the Louisiana Purchase, of course.
The Ranger, home of Texas Forestry

thecfarm

IP has a mill in Jay,about 15 minutes from me.I really wouldn't call this northern Maine.I thought that was old news about them selling their woodlots off.IP been cutting off all of their land around here.One lot is above me.I live only 5 minutes from another plot and 10 from 2 others.The guy that is coming to cut my big pine feels that IP will still have alot to say what goes on after the so called sale.He's been cutting for them for years now.I wouldn't dare guess how much they own,but around here,5000 arces would be a good start.
Model 6020-20hp Manual Thomas bandsaw,TC40A 4wd 40 hp New Holland tractor, 450 Norse Winch, Heatmor 400 OWB,YCC 1978-79

Gary_C

Who knows what this will mean long term for the forest land.

Stora Enso was forced to sell all forest lands after they bought Consolidated and they sold it all in one block to a land management company who was not the highest bidder from what I heard. Perhaps they just transfered it from one hand to the other.

I am sure that IP's sale will make their cash position look a lot better. Or they could now look less attractive to some buyer that wanted to take over the company and pay for the acquisition with the sale of forest land assets.

Two years ago I heard from an IP buyer they were going to stop buying timber sales as they were competing with their own suppliers for the stumpage. Then a year ago they were back bidding again.  ???

It can make your head hurt trying to figure out what they are going to do next.  :)
Never take life seriously. Nobody gets out alive anyway.

SwampDonkey

I was thinking of the IP mill in Island Falls. As far as land sales, Nexfor did the land shuffle last year and simply put it's freehold up for sale and having a sibling company buy it up made a nice tax write-off.  ::)
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

Jeff

Attached is the Press release that was sent to me.
Just call me the midget doctor.
Forestry Forum Founder and Chief Cook and Bottle Washer.

Commercial circle sawmill sawyer in a past life for 25yrs.
Ezekiel 22:30

SwampDonkey

Since they don't mention any forested land holdings in Maine, I am assuming they have license/lease agreements on public lands and or buy all their fibre from other sources.
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

Gary_C

It looks like IP has sold more of it holdings. The report says the kraft paper operations are still on the block.

IP to sell coated papers.
Never take life seriously. Nobody gets out alive anyway.

MemphisLogger

A lot of my friends work(ed) for IP.  :-\

In particular, everyone I know that worked in forest planning and mapping has been loosing their jobs.  :'(

It's not just IP selling off their land, here in TN, Bowater has been doing the same. It seems that their new strategy is to lighten their load in terms of management costs and taxes to bolster their stock values.

In terms of land itself, much is going to Timber Investment Management Organizations (TIMOs) and/or Real Estate Investment Trusts (REITs).

In the case of the TIMOs, the sale usually stipulates continued fiber supply agreements and/or first rights of refusal on future timber sales.  :P

In the case of REITs, alot of land is being split and parcelled for development where locations are desired by yuppies  :'(   

What worries me is the longterm impact this will have on good forest management.

A forest products company can be trusted to at least manage its holdings for sustained yield but a TIMO or REIT, being driven by the stock market, might liquidate its holdings should the economy go sour.   




   
Scott Banbury, Urban logger since 2002--Custom Woodworker since 1990. Running a Woodmizer LT-30, a flock of Huskies and a herd of Toy 4x4s Midtown Logging and Lumber Company at www.scottbanbury.com

Paschale

Quote from: UrbanLogger on June 06, 2006, 08:41:44 AM
It's not just IP selling off their land, here in TN, Bowater has been doing the same. It seems that their new strategy is to lighten their load in terms of management costs and taxes to bolster their stock values.

A forest products company can be trusted to at least manage its holdings for sustained yield but a TIMO or REIT, being driven by the stock market, might liquidate its holdings should the economy go sour.     

It seems like so many things these days are driven solely because of the stock value, and the only real interest executives consider is the bottom line stock value, and making their investors happy.  That's the reason we have so much outsourcing, and it's the reason these friends of yours are losing their jobs.   I find it all kind of disgusting.  :-\
Y'all can pronounce it "puh-SKOLLY"

rebocardo

I am too wired, I thought IP=URL when I read the title. I have to get out more  ;)

I looked at the details of a "hugh" sale in GA about a year ago, after reading all the fine details (think it was WP) I had to ask myself, is it really sold other then in name since it takes 10-20 years with every condition possible attached except if rains on Feb 29th, 2012?

It would be interesting to know the nitty gritty, maybe in that PDF?





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