Ilim Timber Company began its expansion into the U.S. market

Ilim Timber, one of the largest Russian manufacturers of lumber, owned by brothers Zingarevich, acquired the U.S. company Tolleson Lumber. The deal, estimated at about $ 50 million, will allow the company to increase production capacity by almost 25%. Experts believe that Ilim Timber will not stop and will continue to expand into the U.S. market.
As reported yesterday in the Ilim Timber, the company entered into an agreement to acquire 100% of the U.S. lumber producer Tolleson Lumber Company, Inc. of Perry, Georgia (Tolleson). Funding for the transaction was carried out due to the credit of the Savings Bank, according to expert estimates, it amounted to 50-65 million
Tolleson — a family company founded in 1919, specializing in the production of yellow pine lumber at two plants in the state of Georgia. Their total production capacity is 900 thousand cubic meters. m Thus, the two saw mills Tolleson increase the overall production capacity Ilim Timber to the level of 3.9 million cubic meters. meters of lumber per year and will include a range of products from the American yellow pine. In addition, as the company says, "partnership with the management, led by CEO Tolleson Rusty Wood should strengthen the international management team Ilim Timber».
This is not the first foreign asset Ilim Timber: last year it acquired two sawmills Klausner Group in Germany (with the purchase of the production capacity of the holding companies have more than doubled and exceeded 3 million tons of timber per year). It is assumed that the change of ownership at Tolleson will acquire other assets in the U.S., thus increasing its presence in the North American market. According to Rusty Wood, the task of acquiring sawmills in the United States will address management Tolleson. She herself while now controls less than 1% of the U.S. market. However, as stated by Boris Zingarevich, Chairman of the Board of Directors of Ilim Timber, «Tolleson will be a cornerstone for the expansion of business in the United States, which is a part of business strategy Ilim Timber».
Market participants believe that the transaction can not be regarded as a net sink, but rather as a merger. According to Alexander Belov, the general director of "Priozersky DOZ", most likely, the deal was based including at Tolleson Lumber interest in the Russian market. "And for Ilim Timber acquisition of the asset could be very beneficial in terms of floating the dollar," — he said.
Analysts estimate the deal positively, although it noted that the foreign market, the company with the Russian owner may face many challenges, from bureaucracy to difficulties with bank loans. "However, this expansion is promising, — said Dmitry Baranov, a leading expert of" Finam Management ". — As for the reason that there are reserves of raw materials, and because there is a huge market for timber and timber products. "
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