Langley-based San Group has made a deal with Interfor to buy the Acorn sawmill in Delta, a move it says will bolster its Island operations.
San Group, which operates mills in Port Alberni as well as the mainland, will acquire all the assets and inventory of the mill and take on all of its employees.
With the purchase, San Group’s production capacity will exceed 500 million board feet of lumber, making it the second-largest sawmilling company on the coast next to Western Forest Products.
“This is a compelling transaction for all stakeholders. It will deliver significant and immediate value to San Group by connecting Acorn’s production capacity with our current facilities, and to provide current and new employees an opportunity to join a company whose philosophy is centred on increasing the longevity of our forests through value-added manufacturing,” said Suki Sanghera, co-owner of the San Group.
Sanghera said the acquisition will integrate well into the existing mix, which includes the company’s new 300,000-square-foot value-added plant in Port Alberni.
For San Group, the deal means increasing its global customer base.
The Acorn specialty sawmill, built in 1963 and acquired by Interfor in 2001 from Primex Forest Products, specializes in producing lumber squares for the Japanese housing market.
Most of its production capacity, about 140 million board feet of lumber when fully operating, is sent to Asia.
“Acorn’s complementary sawmilling technology, customer base, and geographic footprint make it an excellent fit with our value-added business model,” said San Group co-owner Kamal Sanghera. “The acquisition is also consistent with our go-forward strategy to diversify and accelerate investment in high-growth areas.”
In the past three years, the San Group has spent more than $200 million on facilities, fibre supply and transportation infrastructure.
Last year, the company spent $15 million in partnership with the Port Alberni Port Authority to improve and take control of one of its deep-water berths.
That deal gave San Group, which established three lumber manufacturing facilities in the region, the chance to operate shipping activities at the authority’s Berth 3, where it will invest in new facilities and equipment like storage silos and dockside cranes.