CatchMark JV Completes $1.4B Timberlands Deal

ATLANTA–CatchMark Timber Trust has closed on its previously announced  acquisition of 1.1 million acres of East Texas timberlands for approximately $1.39 billion. It acquired the land in a joint venture with a consortium of institutional investors, including BTG Pactual Timberland Investment Group, Highland Capital Management, Medley Management and British Columbia Investment Management Corp. The joint venture is a CatchMark-managed affiliate called Triple T.

The property was sold by Campbell Global, on behalf of the institutional owners of the property, in what Catchmark says is one of the largest US timberlands transactions of the past decade. Other major transactions include the 2007 sale of 1.55 million acres by Temple-Inland for $2.4 billion, the sale of TimberStar properties in 2008 for $1.9 billion, and the sale of 1.88 million acres by Forest Capital Partners in 2012 for an undisclosed price.

The $1,264 per acre acquisition cost basis of the CatchMark deal compares favorably to regional industry benchmarks, the buying companies said when the deal was first announced.

Furthermore, the acquired timberlands are projected to grow from the current 2.8 million tons of annual harvest volume to more than five million tons by 2028, the companies also said.

The deal has tripled the number of acres under CatchMark’s control to approximately 1.6 million and significantly expanded its fee-based asset management business, the REIT said, propelling it into the same league as the other major timberland REITs of Weyerhaeuser, Plum Creek Timber, Rayonier and Potlatch.

Raymond James acted as financial advisor to CatchMark in the transaction; Alston & Bird LLP and Smith Gambrell & Russell, LLP served as legal advisors to CatchMark. Gibson, Dunn & Crutcher LLP and Proskauer Rose LLP served as legal advisors to the group of institutional investors.