Timber real estate investment trust CatchMark Timber Trust Inc. said it is evaluating a potential offer to acquire Phaunos Timber Fund Ltd. in a stock-for-stock deal that would result in a combined company with an enterprise value of US$1.3 billion.
CatchMark Timber's offer values the target at 57 U.S. cents per share, which will be paid in new shares of CatchMark class A common stock, and rivals Stafford Capital Partners Ltd.'s roughly 49-cents-per-share cash offer for Phaunos Timber.
Phaunos Timber is a closed-end real estate fund domiciled in the Channel Islands that owns a portfolio of premium timberland assets. Roughly 74% of its timberlands, based on portfolio value, are located in New Zealand, with the remaining assets located in the Americas.
The combined entity would have an US$850 million equity value, and it will be managed by CatchMark's executive leadership and board.
The announcement of a firm offer is subject to the satisfaction of a pre-condition and there is no assurance that any firm offer will be made even if the pre-condition is satisfied.
The pre-condition stipulates that Phaunos Timber's interest in the Matariki Forestry Group not be disposed, transferred, mortgaged, changed or otherwise have any security interest created over it. The pre-condition also said that the legal proceedings initiated by Rayonier Canterbury LLC related to the Matariki Forestry Group interest and any other legal proceedings associated with the interest be settled, withdrawn or otherwise resolved to CatchMark's satisfaction.