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Plum Creek to Form Timberlands Joint Venture With Investor Group


By Tess Stynes



Plum Creek Timber Co. Inc. (PCL) said its will sell a portfolio of U.S. timberlands for $420 million to a joint venture it is forming with a group of institutional investors.

The investor group includes the Washington State Investment Board, the Oregon Public Employees Retirement Fund and the Alaska Permanent Fund Corp. The group will have a 75% stake in the venture, which will be called Twin Creeks Timber LLC. Plum Creek, which will manage the venture's timberlands portfolio, will have the remaining 25% interest in the joint venture.

The investor group also is committing about $330 million in capital for timberland acquisitions in the future.

Plum Creek will contribute timberlands valued at roughly $140 million to the venture and commit capital of about $110 million targeted for future acquisitions.

The venture's initial portfolio, valued at roughly $560 million, will consist of 260,000 acres of Southern U.S. timberland located in five states sourced from Plum Creek. The venture aims to expand the portfolio's valuation to roughly $1 billion through timberland acquisitions from third parties.

Silver Creek Capital Management to Act as the managing member and independent fiduciary for the venture.

Plum Creek said its expects to use proceeds from the timberlands sale to reduce debt to to repurchase stock.



Write to Tess Stynes at [e-mail]



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