In a multi-million pound deal, Coillte is to buy Louisiana-Pacific Corporation’s majority 65% shareholding in Louisiana- Pacific Coillte Ireland Ltd.
Coillte, the Irish state-owned forestry company which already owns 35% of the joint venture OSB company, is funding the purchase from its own resources. Called SmartPly Europe, the new company will trade independently within the Coillte group. The transaction is subject to approval under Irish mergers and takeovers law.
The £50m 350,000m³ OSB plant was established at Waterford in 1996. Using raw material from Coillte and privately owned forests, it manufactures wood panels for structural building applications.
Coillte always had the option to assume 100% control and a combination of factors in recent months made the time right. Coillte’s head of public affairs Gerry Egan said: ‘We were conscious that the plant had lost money and there was a need for more of a focus on the European market which was hard to deliver from the US. Meanwhile, LP had decided it wanted to consolidate its operations and focus on building products and the domestic US market.’
Martin Lowery, chief executive of Coillte, said the acquisition would take Coillte into the international forest products business.
SmartPly Europe, he said, would provide an important outlet for pulpwood from Irish forests and be important for the wider wood-processing sector.
Mr Lowery said demand for OSB in Europe was growing at around 30% per year.
