Nevada County Picayune and Gurdon Times Newspaper Archive

Potlatch, ATCO Terminate Agreement

Potlatch Corporation and Anderson-Tully Company (ATCO) announced March 31 the mutual termination of their February 1998 agreement to combine Potlatch's Arkansas timberlands and ATCO's timberlands into Timberland Growth Corporation (TGC).

TGC was to be a publicly traded real estate investment trusts (REIT) focused on the ownership of timberlands. The agreement was subject to a number of conditions, including completion of a successful initial public offering of TGC common stock.

Due to a significant deterioration of REIT markets in mid-1998, the initial public offering was suspended. Recent discussions between ATCO and Potlatch to achieve a mutually beneficial alternative transaction were unsuccessful. Related agreements to sell to Potlatch certain logging, lumber and veneer operations were also terminated.

Potlatch expects to take a first quarter 1999 after tax charge to earnings of approximately $4.6 million for accumulated transaction expenses.

Potlatch and ATCO also announced their intention to explore the opportunities and benefits of supplying hardwood pulpwood and logs from ATCO's timberlands to Potlatch's pulp and paperboard mill at Cypress Bend and its hardwood sawmill at Warren.

ATCO, one of the premier land and hardwood timber management companies in North America, is a REIT.

Founded in 1889, ATCO is headquartered in Memphis, Tenn., with operations in Memphis and Vicksburg, Miss., with timberlands located primarily in Mississippi, Arkansas, Louisiana and Tennessee.

Potlatch is a diversified forest products company with timberlands in Arkansas, Idaho and Minnesota.