Rayonier Inc. announced an agreement March 10 to sell its interests in New Zealand timberlands for $710 million.
The timber and real estate company headquartered in Wildlight in Nassau County owns 77% of a joint venture that controls 412,000 acres in New Zealand.
With the sale, Rayonier will focus exclusively on U.S. operations, which include 1.75 million acres of timberland in the South and 308,000 in the Northwest.
Rayonier also has a real estate development unit with projects including Wildlight.
Rayonier is selling its stake to a fund managed by investment firm TRG, which specializes in emerging assets and real estate.
“After completing a comprehensive review of strategic alternatives for our New Zealand business, we believe the decision to sell our joint venture interest is the best path forward to create value for our shareholders,” said Rayonier CEO Mark McHugh in a news release.
Rayonier’s presence in New Zealand started in 1988 and it produced positive results for the company, McHugh said.
“Despite these positive attributes, the New Zealand business lacks meaningful synergies with our core U.S. operations, and we further believe that the value of the New Zealand joint venture is not fully appreciated in the public markets. Thus, after careful consideration, we believe now is the appropriate time to sell our interest and opportunistically redeploy capital,” he said.
Rayonier said it anticipates paying a special dividend of $1 to $1.40 per share in cash and stock after the transaction closes.
The company announced a realignment plan in November 2023 and anticipated selling off $1 billion in assets, but the New Zealand sale will bring its total dispositions to $1.45 billion under the plan.
“The success of this plan has allowed us to significantly reduce leverage, return capital to shareholders, and generate CAD (cash available for distribution) and NAV (net asset value) per share accretion, while also leaving us better positioned to create long-term value for our shareholders going forward,” McHugh said.