Jemi Fibre recently announced that it has completed the acquisition of Aallcann Wood Suppliers Inc. as previously announced on March 11, 2015 for $1.62 million in cash.
Aallcann is a post peeling and treatment operation based in Prince Albert, Saskatchewan that produces treated timber products for agricultural markets. Its treatment facility is situated on approximately 180 acres of land and it holds a license for 36,000 cubic meters of Crown annual allowable cut.
Mike Jenks, Chairman & CEO, commented "Aallcann is in line with our strategy of acquiring and adding value to underutilized assets, and has similar capacity to our existing high-margin Kootenay wood preserving facility. Since March 2015, we have worked with Aallcann to improve operations, resulting in a 150% increase in monthly production".
The company expects that the Aallcann acquisition will approximately double its wood preserving revenues to over $25 million annually.
In addition, the Company has extended its logging operations into Saskatchewan to service Aallcann and other wood processing operations. The Company anticipates harvesting up to 160,000 m3 of timber in Saskatchewan over the next 12 months.
In light of the accretive nature of the Aallcann acquisition, and the Company's recently announced intention to acquire L&M Wood Products, Jemi Fibre anticipates updating its previously disclosed financial targets.
Mr. Jenks concluded, "We anticipate completing additional accretive acquisitions in the near future, to transition to a higher proportion of earnings from value-added manufacturing operations and provide further geographic diversification."
