Canfor to Consolidate Full Ownership by Acquiring Remaining Canfor Pulp Stakes

Canfor Corporation (CFP.TO) has moved to take full control of Canfor Pulp Products Inc. (CFX.TO) through a court-sanctioned arrangement. The transaction will see Canfor Corp acquire all remaining common shares of Canfor Pulp that it does not currently hold, along with those owned by its affiliates.

Transaction Terms and Shareholder Options

Under the arrangement agreement framework, eligible Canfor Pulp shareholders will have two distinct paths forward. They can either receive 0.0425 common shares of Canfor Corp per Canfor Pulp share, or opt for C$0.50 in cash for each share held. This dual-option structure gives shareholders the flexibility to decide between retaining equity exposure in the combined entity or realizing immediate cash proceeds.

Canfor Corp presently controls approximately 54.8% of Canfor Pulp’s outstanding shares. The cash component of this offer—valued at C$0.50 per share—translates to meaningful premiums over recent trading levels. Specifically, it represents a 25% premium relative to Canfor Pulp’s closing price on December 2, 2025, and extends to a 38% premium when measured against the 10-day volume-weighted average price on the Toronto Stock Exchange (TSX).

Go-Shop Period and Exit Protections

The agreement incorporates a go-shop mechanism that remains active until January 19, 2026. During this window, Canfor Pulp retains the right to pursue, assess, and negotiate with prospective buyers who signal acquisition interest. This provision protects minority shareholders by allowing management to explore alternative opportunities.

Should Canfor Pulp choose to terminate the arrangement in favor of a competing Superior Proposal, the company is obligated to pay Canfor Corp a C$500,000 termination fee. This protective measure aligns incentives while preserving the board’s fiduciary obligations to evaluate all strategic alternatives.