vildmark (![[info]](http://l-stat.livejournal.com/img/userinfo.gif){kind=small} vildmark) wrote,@ 2008-06-09 10:34:00 |
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The Hurwitz era is finally, blissfully over
Judge approves takeover plan for Pacific Lumber (06/09/2008)
Eric Bontrager, Greenwire reporter
A federal judge has given preliminary approval for a takeover of bankrupt Pacific Lumber Inc. by a company owned by the founders of Gap clothing stores.
Judge Richard Schmidt of U.S. Bankruptcy Court for the Southern District of Texas in Corpus Christi issued an order Friday that would allow about 200,000 acres of Pacific Lumber timberland in California to go to Mendocino Redwood Co. (MRC), a nine-year-old logging company controlled by Gap founders Donald and Doris Fisher.
Mendocino was among five entities vying for control of Pacific Lumber following its January 2007 bankruptcy filing. Mendocino owns and manages about 230,000 acres in California's Mendocino and Sonoma counties.
The plan calls for the company to pay $530 million for the land and at the start to reduce logging levels by half, to about 50 million board feet each year of Douglas fir and redwood. It would also keep the Scotia sawmill running and seek sustainability certification from the Forest Stewardship Council.
In giving preliminary approval for Mendocino's reorganization plan, Schmidt described the company as "an experienced, environmentally responsible operator with a proven track record, and whose experience in operating timberlands and working cooperatively with government regulators was uncontroverted at the confirmation hearing."
Friday's announcement was praised by lawmakers, environmental groups and California Gov. Arnold Schwarzenegger (R).
"Today's decision in the Pacific Lumber bankruptcy case is good news for the people of California," Schwarzenegger said in a statement. "I hope this decision will establish a strong precedent that weighs both the economic and environmental benefit of long-term sustainability and preservation."
Pacific Lumber is owned by Houston financier Charles Hurwitz and his Maxxam Corp., which acquired the company in a 1986 leveraged buyout and financed the purchase by cutting more trees.
During nearly 18 months of bankruptcy proceedings, environmentalists who have long criticized Pacific Lumber's practices called for any reorganization deal to adhere to two conservation agreements aimed at protecting California's old-growth redwood forests.
"MRC inherits a landscape that has suffered grievously from more than two decades of serious abuse," said Sam Johnston, private lands campaigner for the Environmental Protection Information Center. "We appreciate MRC's background in restoration-focused forestry and want to work with MRC to build a truly sustainable timber company for the long term. MRC needs to make dramatic changes from Pacific Lumber's practices to fulfill the commitments they have made."
Headwaters Agreement
The 1996 Headwaters Agreement signed by Hurwitz commits the federal and state governments to providing $380 million for the purchase of the largest grove of old-growth redwood trees in private ownership, the Headwaters Grove in California.
The agreement also led to a 1999 Habitat Conservation Plan, which allows for incidental taking of endangered species as long as there are adequate conservation measures that allow for long-term recovery.
Forests protected by the agreements are home to dozens of threatened and endangered species and are part of an important watershed for salmon and other aquatic species. The agreement designates 6,600 acres as marbled murrelet conservation areas.
Sen. Dianne Feinstein (D-Calif.), who wrote a letter to Judge Schmidt urging him to approve a conservation-minded reorganization, played a key role in crafting both deals (Greenwire, Feb. 20).
After declaring bankruptcy, Pacific Lumber unveiled a reorganization plan that involved selling roughly 29,000 acres of its best redwoods to raise $600 million. But creditors disputed the value of the proposed redwood sale, creating a disagreement over the control of about 200,000 acres of redwoods.
Efforts to mediate the dispute failed, leaving the matter in the court's hands.
The deal could still be challenged by a group of bond holders whose debt is secured in the forestland's value. They favored a rival $603 million plan by Texas banker Andy Beal, which Schmidt said was aimed more at foreclosure than reorganization.
Judge approves takeover plan for Pacific Lumber (06/09/2008)
Eric Bontrager, Greenwire reporter
A federal judge has given preliminary approval for a takeover of bankrupt Pacific Lumber Inc. by a company owned by the founders of Gap clothing stores.
Judge Richard Schmidt of U.S. Bankruptcy Court for the Southern District of Texas in Corpus Christi issued an order Friday that would allow about 200,000 acres of Pacific Lumber timberland in California to go to Mendocino Redwood Co. (MRC), a nine-year-old logging company controlled by Gap founders Donald and Doris Fisher.
Mendocino was among five entities vying for control of Pacific Lumber following its January 2007 bankruptcy filing. Mendocino owns and manages about 230,000 acres in California's Mendocino and Sonoma counties.
The plan calls for the company to pay $530 million for the land and at the start to reduce logging levels by half, to about 50 million board feet each year of Douglas fir and redwood. It would also keep the Scotia sawmill running and seek sustainability certification from the Forest Stewardship Council.
In giving preliminary approval for Mendocino's reorganization plan, Schmidt described the company as "an experienced, environmentally responsible operator with a proven track record, and whose experience in operating timberlands and working cooperatively with government regulators was uncontroverted at the confirmation hearing."
Friday's announcement was praised by lawmakers, environmental groups and California Gov. Arnold Schwarzenegger (R).
"Today's decision in the Pacific Lumber bankruptcy case is good news for the people of California," Schwarzenegger said in a statement. "I hope this decision will establish a strong precedent that weighs both the economic and environmental benefit of long-term sustainability and preservation."
Pacific Lumber is owned by Houston financier Charles Hurwitz and his Maxxam Corp., which acquired the company in a 1986 leveraged buyout and financed the purchase by cutting more trees.
During nearly 18 months of bankruptcy proceedings, environmentalists who have long criticized Pacific Lumber's practices called for any reorganization deal to adhere to two conservation agreements aimed at protecting California's old-growth redwood forests.
"MRC inherits a landscape that has suffered grievously from more than two decades of serious abuse," said Sam Johnston, private lands campaigner for the Environmental Protection Information Center. "We appreciate MRC's background in restoration-focused forestry and want to work with MRC to build a truly sustainable timber company for the long term. MRC needs to make dramatic changes from Pacific Lumber's practices to fulfill the commitments they have made."
Headwaters Agreement
The 1996 Headwaters Agreement signed by Hurwitz commits the federal and state governments to providing $380 million for the purchase of the largest grove of old-growth redwood trees in private ownership, the Headwaters Grove in California.
The agreement also led to a 1999 Habitat Conservation Plan, which allows for incidental taking of endangered species as long as there are adequate conservation measures that allow for long-term recovery.
Forests protected by the agreements are home to dozens of threatened and endangered species and are part of an important watershed for salmon and other aquatic species. The agreement designates 6,600 acres as marbled murrelet conservation areas.
Sen. Dianne Feinstein (D-Calif.), who wrote a letter to Judge Schmidt urging him to approve a conservation-minded reorganization, played a key role in crafting both deals (Greenwire, Feb. 20).
After declaring bankruptcy, Pacific Lumber unveiled a reorganization plan that involved selling roughly 29,000 acres of its best redwoods to raise $600 million. But creditors disputed the value of the proposed redwood sale, creating a disagreement over the control of about 200,000 acres of redwoods.
Efforts to mediate the dispute failed, leaving the matter in the court's hands.
The deal could still be challenged by a group of bond holders whose debt is secured in the forestland's value. They favored a rival $603 million plan by Texas banker Andy Beal, which Schmidt said was aimed more at foreclosure than reorganization.
