Stella-Jones acquires Bell Pole Company for US$50 million

On June 30, 2006, Stella-Jones Inc, a leading North American producer and marketer of industrial treated wood products, announced that it had completed, through a wholly-owned subsidiary, the acquisition of substantially all of the assets and operations of Bell Pole Company. Bell Pole is a Canadian manufacturer of wood utility poles based in Western Canada and is also involved in the remanufacturing and treating of dimensional lumber in Alberta. Bell Pole is the wholly owned Canadian subsidiary ultimately of US-based Bell Lumber & Pole Company. The purchase price totalled $50.1 million of which $30.4 million was for inventory and receivables. Equity funding for the acquisition was provided by the private placement of 1,060,000 subscription receipts issued on May 2, 2006 for a total consideration of $18,020,000 Following the closing of the acquisition, the subscription receipts were exchanged into common shares of the Company, on a one-for-one basis. The remainder of the purchase price was financed by the assumption of liabilities, totalling $15.1 million a $10 million debenture to the Fonds de Solidarité des travailleurs du Québec as well as additional debt funding under existing and new bank facilities. Fasken Martineau advised Stella-Jones in this transaction with a led by Daniel Picotte, and including Mireille Tremblay, Charles Kazaz and Chloé Archambault (Montréal); Don Dalik, Jim Piers, Sonya Reiss, Robert Quon, Larry Nelson and Heidi Granger (Vancouver); Linda Huynh (Calgary); and Kai Alderson (articling student, Vancouver).