VANCOUVER, BC, June 7, 2022
/PRNewswire/ - West Fraser Timber Co. Ltd. ("West Fraser" or the
"Company") (TSX and NYSE: WFG) announced today that it has taken up
and purchased for cancellation a total of 11,898,205 common shares
("Shares") at a price of US$95.00 per
Share under its substantial issuer bid ("SIB") for an aggregate
purchase price of approximately US$1.130
The Shares purchased represent approximately 11.7% of the total
number of West Fraser's issued and outstanding Shares and Class B
shares at the time the SIB was announced in late April 2022. After giving effect to the SIB,
West Fraser will have 87,473,547 Shares and 2,281,478 Class B
shares issued and outstanding. No Class B shares were
purchased under the SIB.
"We are pleased to have successfully completed our second
Substantial Issuer Bid, furthering our track record of returning
significant capital to our shareholders. While we were able
to return more than US$1.1 billion to
participating shareholders, the fact that the tender offer was not
oversubscribed suggests that many of our shareholders still see
considerable upside value in our shares," said Ray Ferris, President & CEO, West Fraser.
"West Fraser's capital allocation priorities aim to balance
disciplined investing with returning capital to shareholders, all
while maintaining our financial flexibility. By executing
strategic share repurchases at a price below our estimate of
intrinsic value, we are confident that we will be able to create
significant, long-term value for our shareholders. Given our
strong balance sheet, we will continue to look for additional
opportunities to effectively deploy our capital as we execute on
our strategic objectives, benefit from the resilience of our
product and geographic diversity and provide our customers with the
type of wood-based building products that we expect will be
important contributors to a low-carbon economy."
Since the completion of the Norbord acquisition in February 2021, the Company has repurchased
33,542,183 Shares through the completion of two SIBs as well as
normal course issuer bids, representing approximately 27.2% of the
total Shares and Class B shares outstanding at the time of the
acquisition of Norbord for an aggregate total of approximately
US$2.812 billion. Over the same
period, West Fraser has returned approximately US$112 million to shareholders through dividends,
for a total of approximately US$2.924
billion in capital returned to shareholders through buybacks
All shareholders who made auction tenders and purchase price
tenders will have 100% of their successfully tendered Shares
purchased by West Fraser at the purchase price.
Payment for the Shares accepted for purchase under the SIB will
be effected by Computershare by June 9,
2022 in accordance with the SIB and applicable law.
The Company expects to be eligible to recommence purchases
under its normal course issuer bid ("NCIB") after all Shares
accepted for purchase under the SIB have been taken up. In
connection with the recommenced NCIB and subject to TSX approval,
West Fraser will enter into an automatic share purchase plan with
its broker, which will enable West Fraser to provide standard
instructions and purchase Shares on the open market during
self-imposed blackout periods. Outside of these blackout
periods, Shares may be purchased in accordance with management's
For Canadian federal income tax purposes, a deemed dividend
arises on the repurchase of Shares under the SIB. To assist
shareholders in determining the Canadian tax consequences of the
SIB, West Fraser has determined that for the purposes of the Income
Tax Act (Canada), the paid-up
capital per Share is C$17.49.
West Fraser designates the entire amount of the deemed
dividend arising from its repurchase of the Shares under the SIB as
an "eligible dividend" for purposes of the Income Tax Act
(Canada) and any corresponding
provincial and territorial tax legislation.
For the purposes of subsection 191(4) of the Income Tax Act
(Canada), the "specified amount"
in respect of each Share is US$79.95.
The full details of the SIB are described in the offer to
purchase and issuer bid circular dated April
26, 2022, as well as the related letter of transmittal and
notice of guaranteed delivery, copies of which were filed and are
available on SEDAR at www.sedar.com and on EDGAR at
This press release is for informational purposes only and does
not constitute an offer to buy or the solicitation of an offer to
sell West Fraser's shares.
About West Fraser
West Fraser is a diversified wood products company with more
than 60 facilities in Canada,
the United States, the
United Kingdom, and Europe. From responsibly sourced and
sustainably managed forest resources, the Company produces lumber,
engineered wood products (OSB, LVL, MDF, plywood, and
particleboard), pulp, newsprint, wood chips, other residuals, and
renewable energy. West Fraser's products are used in home
construction, repair and remodelling, industrial applications,
papers, tissue, and box materials.
This news release contains forward-looking information or
forward-looking statements (collectively, "forward-looking
statements") within the meaning of applicable securities laws,
including statements relating to the SIB, including the timing of
payment of the purchased Shares under the SIB, the creation of
long-term value for shareholders through the repurchase of shares
at below our estimate of intrinsic value, additional opportunities
to deploy capital as we execute on our strategic objectives, the
timing of share purchases under the NCIB and the automatic share
purchase plan and other statements that are not historical facts,
are "forward-looking statements" within the meaning of Canadian and
United States securities laws.
Any such forward-looking statements are based on information
currently available to us and are based on assumptions and analyses
made by us in light of our experience and our perception of
historical trends and current conditions. Readers should also
refer to the risk factors set forth in the Company's annual
information form and management's discussion and analysis for the
year ended December 31, 2021, each
dated February 15, 2022, available at
SEDAR (www.sedar.com) and EDGAR (www.sec.gov/edgar.shtml).
There can be no assurance that the plans, intentions or
expectations upon which forward-looking statements are based will
be realized. Actual results may differ, and the difference
may be material and adverse to the Company and its
SOURCE West Fraser Timber Co. Ltd.