Oregon firm to purchase Missoula L-P plant-Company ‘most likely’ will keep current workers, marketing VP says

Louisiana-Pacific Corp. signed a letter of intent Monday to sell its Missoula particleboard plant to Roseburg Forest Products, a family-owned company based in Roseburg, Ore., and looking to increase its share of the particleboard market.

By SHERRY DEVLIN of the Missoulian

"We are pretty excited with this opportunity," said Scott Schroeder, Roseburg’s vice president of marketing. "It fits very well for us strategically. Our vision is to grow the company. This type of product and its location fit really well with the direction that we’re headed."

Both companies expect to close on the deal by year’s end; neither would reveal the purchase price.

Also unknown is how the sale will affect the Missoula plant’s 221 workers. "L-P’s got a very, very good crew of people there," Schroeder said. "We’re excited about the opportunity to marry up with that group."

"Our plan at this point, and our intention with what we know now, is to run the plant very similar to the way L-P has run it in the past," he said. "Most likely, that will mean the same people, but we still have a lot of research to do at this point."

By signing the letter of intent, Roseburg will now be privy to all the information it needs to evaluate the operation, Schroeder said.

Louisiana-Pacific put the Missoula plant on the market last May, saying it would sell about half its manufacturing plants and all of its timberland and lumber mills, in an attempt to erase $1.2 billion in debts.

The Missoula plant was closed Monday for maintenance work, but all employees were given the news either in person or by telephone, said L-P spokesman David Dugan.

"This sale will be a benefit to both companies," Dugan said. "We didn’t have a strong position in the industrial panel business, so it was best to divest. The sale is not a reflection on this particular mill. It is an excellent facility with talented employees; it will be a strong competitor."

In fact, Roseburg plans to ship about half of Missoula’s commodity boards to its melimine overlay plant in Dillard, Ore. The particleboard will be laminated with melimine, top and bottom, for use as cabinets and countertops.

"That’s where the synergies make a lot of sense," Schroeder said. "Missoula’s product is a pine substrate, and there’s a very high demand for that product."

Roseburg owns about 750,000 acres of timberland in southwestern Oregon and north-central California, as well as a plywood plant, particleboard plant, stud mill and an engineered wood plant. This will be the company’s first venture outside Oregon and California.

"There aren’t many opportunities left for us in our local area," Schroeder said. "This is a logical extension for us to move into other areas, not only to position us from a resource standpoint, but also from a market-access standpoint."

The Missoula mill will not increase the demand on Roseburg’s timber supply, he added, because it uses sawdust and wood chips from other Montana mills. Roseburg exports some of its wood chips to Japan.

L-P chairman Mark Suwyn said his company’s position is unchanged. Proceeds from the sale will be applied to L-P’s debt reduction program. (The sale does not affect L-P’s mills in Deer Lodge or Belgrade.)

"This sale will put this mill into the hands of a company focused on the particleboard business, allowing us to fully focus our attention and resources on our ongoing businesses," Suwyn said.

"Particleboard has been a strategic business for Roseburg Forest Products for decades," said Allyn Ford, that company’s president. "L-P’s Missoula facility is a perfect fit for us."

The Missoula plant produces up to 150 million square feet of particleboard per year, including commodity board and various types of shelving.

Reporter Sherry Devlin can be reached at 523-5268 or at [email protected].

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