Canfor Corporation has announced an agreement to acquire all remaining shares of Canfor Pulp that it does not already own, moving to fully consolidate the pulp producer under a court-approved plan of arrangement.
Canfor Corp currently holds roughly 55% of Canfor Pulp’s outstanding common shares.
Under the terms of the transaction, minority shareholders will have the option to receive either $0.50 per share in cash or 0.0425 of a Canfor Corp common share. The cash offer represents a 25% premium to Canfor Pulp’s December 2 closing price and a 38% premium based on the 10-day volume-weighted average price.
The Canfor Pulp board unanimously determined that the offer is in the best interests of the company after reviewing strategic alternatives and receiving an independent valuation. The valuation placed the fair market value of Canfor Pulp shares between $0.08 and $0.52, supporting the fairness opinion provided to the special committee of independent directors.
A go-shop period running until January 19, 2026, allows Canfor Pulp to solicit and evaluate competing proposals. If a superior proposal emerges, the company may terminate the agreement by paying a $500,000 break fee. Canfor Corp does not have a right to match a higher competing offer.
For Canfor Corp, the acquisition would streamline ownership, reduce complexity, and create a stronger combined business with improved access to capital. The company noted that Canfor Pulp continues to face industry-wide challenges, including market uncertainty and constrained liquidity, and that full integration could support long-term value and operational synergies.
Both companies formed independent special committees to evaluate the transaction. Each board, after receiving financial and legal advice, has endorsed the arrangement and recommended shareholder approval. A special meeting of Canfor Pulp shareholders is expected in the first quarter of 2026, with closing targeted for the same period, pending shareholder, court, and regulatory approvals.
If completed, Canfor Pulp shares will be delisted from the Toronto Stock Exchange, and the company will seek to cease being a reporting issuer.
Canfor Corp produces lumber, engineered wood, pulp, paper, pellets and green energy across more than 50 facilities in Canada, the United States and Europe. Canfor Pulp operates two mills in Prince George, British Columbia, with combined annual capacity of 780,000 tonnes of NBSK pulp and 140,000 tonnes of kraft paper.
Source: Canfor
