Rayonier agreed to buy Spokane-headquartered PotlatchDeltic in an all-stock deal valued at about $3.4 billion that would create one of the largest publicly traded timber and wood products companies in North America.
The deal, which will create a new company with 4.2 million acres of land across 11 states including Washington, comes as the Trump administration has implemented tariffs to support an industry struggling with low prices amid weak housing and construction markets.
Under terms of the deal, PotlatchDeltic holders will receive 1.7339 shares of Rayonier for each of their shares, the companies said in a statement Tuesday. That would imply a 7.8% premium to PotlatchDeltic’s closing price.
The announcement came on the same day that President Donald Trump’s sweeping tariffs on imported lumber and wood products take effect, with the intention of boosting domestic manufacturing. The biggest blow from the measures will fall on Canada, the top lumber supplier to the U.S.
Lumber futures touched the lowest level in seven months in September, as high interest rates and elevated costs have squeezed consumers and damped demand for new homes. Wood suppliers are facing what some describe as “the worst market conditions they have ever seen,” the U.S. Lumber Coalition, a Washington, D.C.-based lobbying group, wrote in a letter last month to Trump administration officials.
The tariffs, as well as lower interest rates and an improved housing situation, will help bring prices back up, Eric Cremers, chief executive officer of PotlatchDeltic, said on a conference call Tuesday. The deal will result in “significant strategic and financial benefits beyond what either of us could achieve independently,” he added.
The deal gives Rayonier shareholders 54% of the new entity and its president and chief executive officer, Mark McHugh, will take the same role in the combined business. Cremers will be the executive chairman of the combined company for 24 months after the deal closes, which is expected by the first or second quarter of 2026.
The corporate headquarters of the company, which will take a new name, will be located in Atlanta, Ga., with significant regional offices maintained in Spokane and in Wildlight, Fla.
The new company will operate seven wood products manufacturing facilities, including six lumber mills with total capacity of 1.2 billion board feet and one industrial plywood mill. More than three-quarters of its combined timberland assets will be located in the U.S. South.