The amount of money deposited by West Fraser with the U.S. Department of Commerce has steadily grown so large that it would be attractive to any prospective buyer
willing to bet that a sizable majority of those funds will likely be refunded eventually, as has been the case in past rounds of the cross-border fight.West Fraser’s share price rose 5.5 per cent to $130.68 on the Toronto Stock Exchange on Wednesday, one day after the forestry company said it has met with two Europe-based firms interested in a joint takeover.
The 2006 Canada-U.S. softwood agreement expired in October, 2015, with no replacement. In the latest round of the trade dispute, Canadian producers have been paying U.S. lumber duties since April, 2017. After a preliminary investigation earlier this year, the Commerce Department said it plans to levy tariffs of 11.64 per cent against most Canadian lumber producers exporting to the United States starting this autumn, compared with the current 17.91 per cent. The reduced tariffs would consist of 6.88 per cent in countervailing duties for what the U.S. calls Canadian subsidies, and 4.76 per cent in anti-dumping duties .
Industry analysts expect West Fraser to provide an updated dollar amount for lumber duties deposited in the United States when it releases its second-quarter results next week. Chief executive Ray Ferris is scheduled to speak with analysts during the quarterly conference call on July 28. B.C. billionaire Jim Pattison owns more than 8.9 million West Fraser common shares, or a 10.2-per-cent interest, and he also has a 52-per-cent stake in Canfor Corp., Canada’s second-largest lumber producer. In late 2019, Mr. Pattison abandoned his plans to take Canfor private, after minority shareholders narrowly rejected his cash offer.
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