PotlatchDeltic To Buy CatchMark In An All-stock Deal

PotlatchDeltic Corporation (PCH), a forest products company, and CatchMark Timber Trust, Inc. (CTT), a real estate investment trust or REIT focused on prime timberlands, said they have inked a merger deal whereby PotlatchDeltic will buy CatchMark in all stock, at a premium.

Following the deal, which is expected to be closed in the second half, CatchMark were trading up more than 28 percent in premarket, at $10.68.

PotlatchDeltic will hold majority of the shares in the combined firm. Following close of the transaction, PotlatchDeltic stockholders will own approximately 86 percent of the combined company, whereas CatchMark stockholders will own around 14 percent on a fully diluted basis.

According to the deal, CatchMark stockholders will receive 0.23 shares of PotlatchDeltic for each share of CatchMark that they own. This means a price per share of $12.88 for each common share of CatchMark, and a 55 percent premium to CatchMark’s common share price as of the close of business on May 27.

Based on the closing stock prices of PotlatchDeltic and CatchMark on May 27, the combined company is expected to have a pro forma market capitalization over $4 billion and total enterprise value of over $5 billion, including $557 million in net debt.

Eric Cremers, CEO of PotlatchDeltic, said: ” With CatchMark, we gain significant scale in three states and diversify our timberland holdings into some of the strongest markets in the U.S. South. In addition, the location of CatchMark’s land near large population centers provides attractive rural real estate sales opportunities. PotlatchDeltic will retain a strong balance sheet and liquidity after the merger is completed, providing a platform for continued growth.”

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