Wood-products maker Boise Cascade LLC, which has been controlled by a Chicago private-equity company since 2004, is selling stock just as the housing market and its own fortunes begin to improve. It announced the upcoming sale Wednesday. The company will be renamed Boise Cascade Co.
Why?
To raise cash to invest in the business. Ultimately, taking the company public is designed to make more money for its owners. The planned February IPO opens the way for subsequent stock sales at the owners’ choosing.
Boise Cascade LLC announced its intention to go public in November. The private-equity firm, Madison Dearborn Partners, owns 80 percent of the company. OfficeMax, the office-supply retail chain, owns 20 percent.
How much money will this sale raise?
Boise Cascade expects to offer 11.7 million shares of common stock at $16 to $18 a share. The sale should raise an estimated $200 million to $250 million. Boise Cascade says the sale represents about one-fourth of the company. That suggests its owners value the company at about $800 million.
A date for the IPO is not yet set. Shares will be sold once a registration statement filed with the U.S. Securities and Exchange Commission becomes effective. The company also will allow the firms underwriting the sale to buy an additional 1.8 million shares.
Will Madison Dearborn eventually sell all its interest in Boise Cascade Co.?
“Given that they are a private equity firm, they probably will ultimately,” Boise Cascade spokesman John Sahlberg said. Madison Dearborn probably won’t make any money off the initial stock offering, Sahlberg said.
Does this mean the old Boise Cascade is back?
Only in part. Boise Cascade Corp. was an iconic Idaho company, but it fell on hard times. In 2004, it bought OfficeMax, took on OfficeMax’s name and sold a majority ownership in its wood-products and paper operations to Madison Dearborn, which used them to create Boise Cascade LLC, a much smaller company.
Boise Cascade LLC today makes plywood and other wood products and distributes building materials. It still operates in the former Boise Cascade Corp. headquarters building at 11th and Jefferson streets in Downtown Boise. It sold its paper-making operations in 2008, leading to the creation of Boise Inc., a publicly traded paper company that still operates in the old headquarters building, too.
How many people are employed at Boise Cascade LLC?
Boise Cascade employs 4,500 companywide. In Idaho it has 320 workers, including 160 at the headquarters. There are no plans to move the headquarters.
Does Boise Cascade LLC still have other operations in Idaho?
It has two building material distribution yards, one in Boise and the other in Idaho Falls. It has a laminated-beam plant outside of Nampa.
Who will lead Boise Cascade Co.?
Tom Carlile, the current CEO.
Will the stock be listed on an exchange?
Boise Cascade has conditional approval to trade stock on the New York Stock Exchange under the symbol BCC.
How has Boise Cascade LLC been doing?
The company was clobbered as the housing bubble burst four years ago. It lost $358 million between 2008 and 2011. At one point, company officials said 70 percent of the housing market on which they depend was gone. Boise Cascade LLC closed a laminated-beam plant in Emmett in April 2011, idling 40 workers.
By 2012, conditions improved. Projected year-end earnings for 2012 are at least $39.2 million on sales of at least $2.76 billion, according to company filings with the SEC.
How can I learn more about the stock offering?
Copies of a preliminary prospectus may be obtained by writing B of A Merrill Lynch at 222 Broadway, New York, N.Y., 10038, Attention: Prospectus Department, or by emailing dg.prospectus_requests@baml.com.
Twitter: @IDS_BillRoberts
JOIN THE DISCUSSION | Register here
We welcome comments. Please keep them civil, short and to the point. ALL CAPS, spam, obscene, profane, abusive and off topic comments will be deleted. Repeat offenders will be blocked. Thanks for taking part — and abiding by these simple rules. A thorough explanation of rules of conduct can be found in our Terms of Service. If you have any questions, including why your comment may not be showing immediately after you submit it, be sure to visit the commenting FAQ.