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BULLETIN: Domtar Inc. In Proposed Joint Venture To Combine Lumber Operations With Tembec Inc. Jun 03
Standard & Poors, June 2003
Abstract
TORONTO (Standard & Poor's) June 19, 2003--Standard & Poor's Ratings Services today said the proposed joint venture combining Domtar Inc.'s (BBB-/Stable/--) lumber operations in Ontario and Quebec with those of Tembec Inc. (BB/Stable/--), will not affect the ratings or outlook on either company. Domtar and Tembec will each own 50% of the new company, and should benefit in the long term from the combined operation's critical mass, greater market share, and efficiencies in resources and manufacturing achieved through best practices. Annual synergies of C$30 million to C$40 million are expected from the new operation. Nevertheless, with continuing weak prices for lumber, high U.S. export duties, and margin pressure from the strong Canadian dollar the profitability of the joint venture and...
Companies mentioned in this report are: Domtar Inc.,Tembec Inc.
Action: S&P Event
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research type: News
This product is a is a brief one-page announcement of no more than 500 words with a quote from the analyst. It is media and investor focused with no accompanying commentary article.
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