Second Tembec investor opposes Rayonier’s $807 mln buy

U.S. hedge fund manager Restructuring Capital Associates (RCA) said it expects to vote its shares of Tembec Inc (TSX: TMB) against the proposed merger with Rayonier Advanced Materials Inc (NYSE: RYAN). RCA, Tembec’s second largest shareholder with a 17.1 percent interest, said it supports the Canadian paper and cellulose pulp maker but agrees with the arguments made by Oaktree Capital Management against Rayonier’s acquisition. The deal, announced in May, is valued at US$807 million. Shareholders will vote on July 27.


Second Largest Tembec Shareholder Expects To Vote Against Rayonier Transaction Unless Rayonier Improves Its Offer

STAMFORD, Conn., July 18, 2017 /CNW/ — Restructuring Capital Associates L.P. (RCA) announced today that it expects to vote its shares of Tembec Inc. against the proposed combination of Tembec with Rayonier Advanced Materials Inc. at the Tembec shareholders’ meeting scheduled for July 27, 2017. RCA reached this position after reviewing the July 14, 2017 letter from Oaktree Capital Management to Tembec and Rayonier, and Rayonier’s response dated July 17, 2017. James Bennett, the founder of RCA, said:

“We have held shares in Tembec for almost a decade and are highly supportive of management and the Board of Directors. They have done a terrific job in turning around the company into a profitable and growing enterprise. While they support the Rayonier merger, we are not prepared to vote for the transaction unless Rayonier responds more appropriately to the points made by Oaktree. The strategic merit of this unique combination can improve profitability exponentially and Oaktree makes a compelling case that Rayonier can and should improve its offer. Rayonier’s response was not persuasive. We urge Rayonier to engage constructively in order to accomplish a combination that is fair to both sets of shareholders.”

According to the information statement published by Tembec, the transaction must be approved by two-thirds of the Tembec shares voted at the shareholder meeting. The record date for the meeting is June 19, 2017. At that date, Oaktree claims to have held 19.9% of Tembec outstanding shares and RCA held 17.1% of the outstanding shares.

About Restructuring Capital Associates, L.P.

Restructuring Capital Associates, L.P. (RCA) is an investment adviser registered with the U.S. Securities and Exchange Commission headquartered in Stamford, Connecticut. RCA and its affiliates have a 28 year history of managing investment funds to maximize total return on their investments in financially troubled companies and other special situations.

For further information: Scott V. Beechert, General Counsel and Chief Compliance Officer, 203-353-3101,

Photo courtesy of Reuters/Ben Nelms