After 63 years in operation that began with a single sawmill in 100 Mile House, Ainsworth Lumber Co. Ltd. is being sold to United States forestry giant Louisiana-Pacific Corporation (LP) for $1.1 billion US.
Ainsworth president and CEO Jim Lake says he understands, and expects, it will be “business as usual” with “definitely no significant change” to its operations or employees.
“We think it is all going to be very positive for the people. In general, the company has a bigger platform – it’s very strategically focused in the field we play in. So, long term, it’s going to give a better financial strength to manage this through the cyclical markets that [the industry] tends to be in.”
The local facility is one of its two plants with unique technology suited to serving the Japanese market, which Lake notes is an important distinction.
“We believe the deal is very good for all of the operations in the company, but specifically for 100 Mile, because LP is very interested in the Asian markets and 100 Mile is a significant supplier to Asia.”
The Grande Prairie plant also ships to Asia, but he says “the bulk of it” comes from 100 Mile House, as well as several other speciality items.
“100 Mile is also very strategic with some of our other value-added products, specifically the products that we sell into the engineered wood business. And, that is all part of why LP likes us – they like our mix of products and our geographic channels that we go [in] to the markets.
“I’m sure they have no intentions of changing that; if anything, they are going to want to grow from where they are.”
Founded by David Ainsworth in 100 Mile House in 1950, the forest company expanded by leaps and bounds until it went public in 1993, and built its first oriented strand board (OSB) plant just off Exeter Station Road.
Today, Ainsworth is a leading manufacturer and supplier of oriented strand board in Canada, with four manufacturing plants across British Columbia, Alberta, and Ontario, and a head office in Vancouver.
Its board of directors has voted unanimously to accept the deal with the Nashville-based LP, Lake adds, and majority shareholder Brookfield Asset Management has given its written support of the transaction.
However, it won’t become final until later this year, providing it gains the approval of federal regulators, he explains.
For now, Lake says he will work personally with LP CEO Curt Stevens during the next few months to develop a transition and integration plan.
“I don’t want to speak totally for Louisiana-Pacific, but at the end of the day, they like what we do, they like what our people do, so why would they want to change?”
Ainsworth has already undergone a lot of changes, he notes, through corporate restructuring from family-run to bond-holders in 2008, and continuing through Brookfield’s take over of 54 per cent ownership, and subsequent upper management changes.
“This now gives some security with a [larger] company that is in it for the long term … LP has been in Canada for over 35 years.”
Lake says Ainsworth “absolutely” foresees a “very promising future” for its lumber facilities under LP’s acquisition.
“We believe that … with LP’s platform and a strategic focus in this industry, we really believe that is the best possible outcome.”