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Stella-Jones Inc. (TSX:SJ) agrees to purchase wood pole manufacturing business of Texas Electric Cooperatives

Forestry
TSX:SJ
16 September 2022 15:00 (EDT)
Stella Jones - CEO, Eric Vachon

Source: Stella-Jones

Stella-Jones (SJ) has signed a definitive agreement to purchase the wood utility pole manufacturing assets of Texas Electric Cooperatives (TEC).

The planned total purchase price of the assets is US$28 million plus inventories of approximately $4 million.

TEC produces southern yellow pine utility poles using Creosote and CCA preservatives at its wood-treating facility in Jasper, Texas.

It is estimated that wood pole sales for the year ended December 31, 2021, totalled $28 million.

“This acquisition, which adds a 43rdmanufacturing facility to our network, will enhance Stella-Jones’ offerings and expand our capacity to supply the growing needs of North America’s utility pole industry while optimizing the overall efficiency of our continental network,” stated Eric Vachon, President and CEO of Stella-Jones.

“We look forward to welcoming the Jasper facility employees to our team of over 2,400 employees across North America,” he added.

The transaction is scheduled to close before the end of 2022 and is subject to customary closing conditions.

Stella-Jones intends to finance the transaction with its existing credit facilities.

Stella-Jones Inc produces and sells lumber and wood products. It supplies all the continent’s major electrical utilities and telecommunication companies with wood utility poles.

Stella-Jones Inc. is down 1.71 per cent, trading at $40.81 at 2:33 PM ET.


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