Western Forest Products attempts to raise $50M, Duncan-based firm offers more shares

Western Forest Products is looking to raise $50 million by offering additional shares to the Duncan-based forest company's existing shareholders.

 Murray Johnston, WFP's chief financial officer, said the share offer is intended to help the company raise capital and reduce its debt.

 "It's not an unprecedented move because we made a similar offer to our shareholders when we acquired Cascadia two years ago," Johnston said from his Duncan office Tuesday.

 "We're prepared to do it again in the future if we need to raise capital but we hope we don't have to. However, who knows what the future will bring?"

 WFP, Vancouver Island's largest forest company, reported last month that it lost $25 million in the third financial quarter of the year, on top of the loss of $36 million in the first six months of the year.

 Like most of the company's Vancouver Island operations, WFP's two sawmills in Nanaimo are operating at reduced rates until the forest industry rebounds, with the downtown operation now employing just 148 people, while the Duke Point mill has 173 employees.

 Johnston said a "key point" of the share offer is that Tricap Partners Ltd., WFP's largest shareholder, has committed to buy any of the $50 million in offered shares that are not bought by the company's existing shareholders. "So we know we'll get the $50 million we're looking for, no matter what," he said.

 "It will be a six-week process that will have its closing date in January."