Plum Creek Sells 107,000 Acres And Colville Mill Stimson Lumber Pays $150 Million In Biggest Timber Deal Since 1993

Plum Creek Timber Co. sold about a third of its timber holdings in the Inland Northwest on Wednesday to Stimson Lumber Co. of Portland.

Plum Creek sold 107,000 acres of land scattered around northeastern Washington and North Idaho, along with its sawmill in Colville, Wash., for $150 million.

It represents the largest block of timber to change hands in the area since 1993, when Crown Pacific bought 257,000 acres from DAW Forest Products and W-I Forest Products. That sale also included seven sawmills, making the total deal worth $250 million.

The land and mill will be Stimson’s first holdings in the area, although the company owns sawmills in Montana.

Ron Mundt, Stimson vice president and chief financial officer, said Stimson will keep the Colville mill running “as it stands” and look at possible expansion.

“We feel we’re getting some productive and well-stocked lands,” Mundt said from Portland. “We’re also getting a modern, state-of-the-art mill backed by adequate timber holdings.”

The mill and a timber management office in Newport, Wash., employ about 220 people, said Kris Backes, director of corporate affairs in Plum Creek’s Rocky Mountain Region.

The company will own about 1.7 million acres of timberland in the region after the sale, 1.5 million of that being in Montana.

Plum Creek recently bought 538,000 acres of timberland in Arkansas, but Backes said the company continues to look for timber to buy in the Northwest.

Other large Northwest-based timber companies have followed the trail southward. Weyerhaeuser Co., Louisiana-Pacific Corp. and others recently have bought large amounts of southern timberland, where pines and other species grow far faster than in the Inland Northwest.

As part of the sale agreement, Stimson agrees to “pretty much keep the mill intact,” Backes said. “We don’t know exactly what their management plans are, but they’ve agreed to hire most everybody back on.”

Stimson owns sawmills in Libby and near Missoula. The trees purchased Wednesday could help keep those mills going, Mundt said, along with providing enough lumber for Colville.

Stimson already gets trees from Plum Creek for those Montana mills. Stimson approached Plum Creek with a “very attractive” offer for the land and the mill, Backes said. The deal had been in the works for a few months, Mundt said.

The companies hope to close the sale by the end of the year, and could have most legal matters handled as soon as October, Mundt said. The sale must be approved under federal antitrust laws.

Plum Creek has owned the Colville sawmill since 1989, when the company was formed as a limited partnership, Backes said.

When Stimson bought the plywood mill near Missoula in 1989, it modernized the plant and cut the number of workers in half. But the mill, so far, has survived the timber crisis that has padlocked the gates of mills throughout the region this decade.

In the last 18 months, four sawmills have shut down in the region due to sourcing problems or the cost of modernization.

Mundt in Portland said Stimson’s purchase, along with timber sales from state lands and timber from other private landowners, should be enough to keep Colville’s mill running.

Plum Creek will continue to run its Spokane laminated board mill, which is a joint venture with a Japanese company. It will have no other lumber processing facilities in the Inland Northwest.

Colville has been hurt recently by cutbacks at Vaagen Bros. Lumber Co. sawmill and the closure of several small, family owned mills in the past two years.

, DataTimes MEMO: Cut in Spokane edition

This sidebar appeared with the story: PLUM OF A DEAL The buyer: Stimson Lumber Co. of Portland. Owns two sawmills in Montana and other assets in Oregon. The seller: Plum Creek Timber Co. of Seattle. Will own 1.7 million acres of land in Montana, North Idaho and Eastern Washington after the sale. The deal: 107,000 acres of timberland in northeastern Washington and North Idaho, a sawmill in Colville and a management office in Newport. Together, the operation employs 220 people, mostly at the mill. Part of the purchase agreement requires Stimson to hire the workers there. The price: $150 million, making it one of the biggest timber sales this decade.