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WILDLIGHT, Fla. - Rayonier Inc. (NYSE:RYN), a leading timberland real estate investment trust with a market capitalization of $4.3 billion and annual revenues of $1.26 billion, has reached an agreement to sell its 77% stake in a New Zealand joint venture to Ents LP, a special purpose vehicle managed by The Rohatyn Group (TRG), for $710 million. The transaction, subject to customary adjustments, is expected to close within 2025, pending regulatory approvals and other closing conditions.
According to InvestingPro data, Rayonier maintains a GREAT financial health score and has consistently paid dividends for 32 consecutive years, currently offering a substantial 10.6% yield to shareholders.
This strategic move concludes Rayonier’s review of its New Zealand operations, allowing the company to focus on its core U.S. markets, which show promising long-term growth prospects. The divestiture aims to enhance shareholder value by leveraging the disparity between public and private timberland values and reducing leverage in a high-interest-rate environment. The company currently operates with a moderate debt level, with its cash flows sufficiently covering interest payments.
The New Zealand joint venture, valued at an enterprise value of $922 million, manages approximately 287,000 productive acres of timberlands. Rayonier’s exit from New Zealand is intended to simplify its portfolio and financial reporting while streamlining its shareholder value proposition.
TRG, with its expertise in global forestry assets and long-term capital orientation, is expected to foster growth and value creation in the New Zealand business. The transaction’s proceeds will be directed by Rayonier towards further debt reduction, potential special dividends, share repurchases, synergistic acquisitions, or other capital allocation priorities. Post-transaction, Rayonier anticipates a special dividend for 2025 ranging from $1.00 to $1.40 per share, the details of which will be announced later in the year.
Mark McHugh, President and CEO of Rayonier, stated that the sale of the joint venture interest is aligned with the company’s objectives to create shareholder value and opportunistically redeploy capital. He also expressed confidence in TRG’s capability to manage the New Zealand assets effectively.
The sale is part of Rayonier’s broader asset disposition and capital structure realignment plan, which has now surpassed the initial $1 billion target with total dispositions amounting to $1.45 billion. This has enabled Rayonier to significantly reduce leverage and enhance shareholder returns, positioning the company for future value creation.
Nick Rohatyn, CEO of TRG, expressed enthusiasm for the acquisition and the potential to integrate Rayonier’s New Zealand business into TRG’s global portfolio. Mike Claridge, TRG Partner and Head of Forestry & Agriculture, highlighted the New Zealand team’s industry leadership and the intent to build on their success.
This news is based on a press release statement and does not include any speculative content or unsourced claims.
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