Rayonier Advanced Materials Announces Sale of Softwood Duty Refund Rights

Rayonier Advanced Materials (RYAM), a global leader in high purity cellulose, announced on Monday that it has reached agreement regarding the sale to OCP Lumber LLC of the company’s entitlements to refunds, including all accrued interest, related to the duties imposed on softwood lumber exported by RYAM from Canada into the US during a specific period between 2017 and 2021.

The sale price for the refund rights is $39 million with the opportunity for the company to receive additional future sale proceeds contingent upon the timing and terms of the ultimate trade dispute outcome. Closing and funding is expected to take place within the next 30 days, contingent upon customary closing conditions.

RYAM previously owned six softwood lumber mills in Ontario and Quebec, Canada, and made duties deposits of approximately $111 million to the US in connection with lumber exports into the US between 2017 and 2021. At the time the company sold these lumber assets in 2021, it retained all rights and obligations to these duties’ deposits.

In remarks accompanying the announcement, RYAM President and CEO De Lyle W. Blomquist said:

“This innovative purchase and sale agreement is another key step for the Company in our ongoing efforts to strengthen our financial position, optimize our asset base and focus on our core business strategy. By monetizing our rights to these softwood duty refunds, we are unlocking value from a non-core passive asset and further bolstering our balance sheet.”