GreenFirst Forest Products Sells Its Softwood Lumber Duty Refunds to Mahogany Investors

Ontario-based GreenFirst Forest Products is selling its softwood lumber duty refunds to Mahogany Investors, LLC for US$17.5 million, Nothern Ontario Business reported (1-2-25).

According to GreenFirst, it has entered into a strategic agreement with Mahogany Investors for the sale of its refunds, including accrued interest, on duties paid for softwood lumber exported to the US in 2021 and 2022. The duties stem from US$60 million worth of deposits made during GreenFirst’s ownership of six softwood lumber mills in Ontario and Quebec. The company sold the Quebec operations in 2023 but still retains the right to any potential refunds tied to these deposits.

In Northern Ontario, GreenFirst operates sawmills in Chapleau, Cochrane, Hearst, and Kapuskasing, the latter site which also includes a newsprint mill, which has been spun off into a separate company. The company purchased these operations and assets in Quebec in 2021 from Rayonier for US$235 million before selling the Quebec operations a year later.

GreenFirst said the proceeds are earmarked for the first phase of the company’s strategic expenditures plan aimed at positioning GreenFirst as the largest sawmiller in Ontario.

“This agreement underscores our commitment to strengthening our financial foundation while maintaining focus on our core business operations,” GreenFirst CEO Joel Fournier said. “By monetizing these refund rights, we are unlocking value and enhancing our ability to pursue strategic initiatives.”

The company has also monetized some property by selling 118 acres of private forest land to Kenora Chiefs Advisory (KCA) last month for $5 million. The property’s located within the City of Kenora. The transaction closed on December 6.

“This sale will enable KCA to pursue long-term development opportunities on the property while unlocking significant value for GreenFirst shareholders,” Fournier said.