Tembec’s $475m sale to Rayonier nears completion
Canadian paper producer Tembec Inc.’s sale to Rayonier Advanced Materials Inc. has moved a step closer after its two biggest shareholders finally agreed terms.
The deal with the Florida-based real estate trust, which was announced in May, has been on hold due to Oaktree Capital Management and Restructuring Capital Associates not supporting the price that was originally agreed.
Their stance has resulted in Rayonier now offering Tembec investors $4.75 in cash per share, an increase of 17% on the earlier valuation – and an acceptable price for the two primary shareholders.
This represents a 61 percent premium over the closing price on May 24, the last day of trading prior to the original deal being announced.
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“They reached out to us at the end of last week, and we had some constructive and professional dialogue,” said Rayonier Chief Executive Office Paul Boynton.
“It was a positive dialogue and, yes, we increased our offering.”
Tembec manufactures other forest products including lumber, pulp and high purity cellulose and is a global leader in sustainable forest management practices.
It currently employs approximately 3,000 workers in Canada and France, achieving an annual turnover of $1.5bn.
“Rayonier Advanced Materials is the ideal partner for us, given the complementary nature of our products, expertise, and resources,” commented James Lopez, President and Chief Executive Officer of Tembec, in May.
“They are committed to our operations and employees in Canada and France and - above all - to the values we share.”
CB Insights: US Insurtechs Compete In A Now Global Market
In the first half of the year, insurtech companies around the world have raised US$7.4bn, nearly doubling their funding in Q2. According to Digital Insurance, insurtechs have raised US$4.8bn in Q2—an 89% increase in funding from Q1. But US firms are no longer the sole beneficiaries.
What Are the Stats?
Out of the 15 Q2 mega-rounds—those that top US$100mn—only eight included American firms. Pretty good, you might say. That’s over half! But US companies only made up 38% of the deals, which marks a 10% drop from Q1 and a 12% drop from 2020. Technically, therefore, US insurtechs are less influential than they’ve been in the past. But who says this is a bad development?
Despite my American citizenship, I’d argue that a more globally diverse insurance market is only for the best. Many of the world’s citizens who could most benefit from improved insurance services live outside of the States—and deserve local, tech-savvy services.
Why Does This Matter?
You’re always going to see the typical insurtech contenders from Western countries. For instance:
- German-based wefox: US$650mn Series C
- UK-based Bought By Many: US$350mn Series D
- US-based Collective Health: US$280mn Series F
But it’s critical that we address risk across the world. American insurtechs might be some of the most technologically skilled firms in the industry, but it’s not their first goal to address floods in Southeast Asia, crop destruction in China, and COVID complications in South Africa. That’s why we should celebrate that the recent Q2 round included insurtechs from 35 different countries.
According to CB Insights’ Q2 2021 Quarterly InsurTech Briefing, this was the first time that they’d observed insurtech activity in Botswana, Mali, Romania, Saudi Arabia, and Turkey. And ‘from a product, service, distribution, and underlying risk perspective, we—as a society and as an industry—are moving at an unprecedented speed’, says Dr. Andrew Johnston, Global Head of Willis Re InsurTech.
Just ask CB Insights. InsurTech value propositions have resonated with the world.