Business
Mercer International Inc. to Acquire Holzindustrie Torgau ("HIT") Significantly Expanding Its Solid Wood Operations
HIT owns and operates an integrated timber processing facility with wood pallet, lumber, biofuel and energy production. Consideration of €270 million (approx.
About this update from Mercer International Inc.
[{"type":"text","content":"HIT owns and operates an integrated timber processing facility with wood pallet, lumber, biofuel and energy production. Consideration of €270 million (approx. $275.4 million), inclusive of forecasted net working capital of approximately €43 million (approx. $43.9 million).HIT is the world’s largest producer of EPAL wood pallets used for shipping and, in 2021, sold 295 MMfbm of wood pallets and 22 MMfbm of traditional lumber products. Sawmill residuals are used to produce biofuels in the form of wood pellets and briquettes. Hit has a total green lumber sawmill capacity of approximately 410 MMfbm and electricity generation capacity of 15MW.For fiscal year 20211, HIT had: net revenues of €227 million, including approximately €169 million from pallets, €17 million from other lumber / wood / milled products, €27 million from biofuels and €12 million from electricity; andnet Income of €31 million and Adjusted EBITDA of €68 million. For the first quarter of 2022, HIT had revenues of €72 million, net income of €12 million, and Adjusted EBITDA of €22 million1.Post-acquisition, Mercer will be the largest German pallet producer and have a combined annual lumber capacity of approximately 960 MMfbm with incremental electricity generation capacity.The transaction is immediately accretive, advancing our long-term strategy of growing our timber processing and wood production business and creating meaningful synergies. __________________________1 Based on materials prepared by HIT pursuant to German GAAP and reported in Euros. NEW YORK, July 22, 2022 (GLOBE NEWSWIRE) -- Mercer International Inc. (Nasdaq: MERC) (\"Mercer\", the \"Company\", \"we\", \"our\") today announced that it has entered into an agreement to acquire all of the outstanding shares of the parent company of HIT for consideration of €270 million, inclusive of forecasted net working capital of approximately €43 million (the \"Transaction\"). HIT owns, among other things, 100% of a timber processing and value-add pallet production facility in Torgau, Germany (the \"HIT Facility\") and a wood processing facility in Dahlen, Germany that produces garden products. The Transaction is subject to customary closing conditions, including receipt of requisite regulatory anti-trust approvals. The Transaction is expected to close in the third or early fourth quarter of 2022. Sangra Moller LLP ...