Huu-ay-aht buys $36.2M stake in WFP Port Alberni TFL and sawmill
March 17, 2020 By Maria Church
A Huu-ay-aht First Nations-owned limited partnership is buying a majority stake in Western Forest Products’ (WFP) Tree Farm Licence 44 on Vancouver Island, and a 7 per cent stake in its Port Alberni, B.C., sawmill.
WFP and Huu-ay-aht announced the $36.2-million agreement between the coastal lumber producer and Huumiis Ventures – a limited partnership beneficially owned by Huu-ay-aht First Nations – yesterday evening.
“This is an historic announcement that is fundamentally about reconciliation and forestry revitalization,” said Chief Councillor Robert J. Dennis Sr. “This agreement will enable Huu-ay-aht to have more jurisdiction over our ḥahuułi (traditional territory), strengthen the long-term sustainability of the forest sector in the Alberni Region, provide strong environmental stewardship that aligns with Huu-ay-aht’s forestry guiding principles, and create more opportunities for First Nations, including our citizens.”
WFP president and CEO Don Demens said the agreement is an example of how collaboration between First Nations and the private sector can contribute to reconciliation. “Western is committed to the long-term success of this partnership, and we look forward to continuing to work towards our shared goal of revitalization of a forest sector that benefits everyone in the Alberni Region,” he said.
The agreement details are as follows:
TFL 44 Limited Partnership
- Huumiis will acquire an incremental 44 per cent ownership interest in TFL 44 LP from WFP for $35.2 million.
- On completion of the transaction, Huumiis will own 51 per cent of TFL 44 LP and WFP will own 49 per cent of TFL 44 LP.
- WFP may sell other area First Nations, including Huumiis, a further incremental ownership interest of up to 26 per cent in TFL 44 LP, under certain conditions.
- WFP and TFL 44 LP will enter into a long-term fibre agreement to continue to supply WFP’s B.C. coastal manufacturing operations, which have undergone significant capital investment over the past several years.
Alberni Pacific Division (APD) sawmill
- WFP will transfer its APD sawmill into a newly formed limited partnership (APD LP) along with certain other assets and liabilities.
- Huumiis will acquire a 7 per cent ownership interest in APD LP from WFP for $1 million, and subject to further negotiations, Huumiis will have an option to purchase an incremental ownership interest in APD LP, which may include a majority interest.
The transaction, subject to closing conditions, is expected to close in the second quarter of 2020.
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