Rayonier has finalized its merger of equals with PotlatchDeltic, creating a timberland powerhouse with a combined portfolio of more than 4 million acres across the U.S. South and Northwest. This transaction consolidates two major players into a land resources real estate investment trust (REIT) that also operates six sawmills and an industrial plywood mill. The combined entity will initially trade under the ticker RYN but plans to announce a new name and symbol before the end of the first quarter.

The leadership structure reflects the merger-of-equals nature of the deal, with top talent distributed between both legacy firms. Mark McHugh remains President and Chief Executive Officer under a four-year contract, while former PotlatchDeltic CEO Eric Cremers becomes Executive Chairman for a two-year term. The board is split equally, featuring five directors from each legacy company. To ensure stability during the integration, any attempt to remove the CEO or Executive Chairman prior to the second anniversary requires a 75% supermajority vote from the board.

Financial terms of the deal involved PotlatchDeltic shareholders receiving 1.8185 Rayonier shares and $0.61 in cash for each share held. Rayonier issued roughly 141 million common shares to complete the acquisition. Executive compensation terms were also finalized: McHugh will receive a base salary of $950,000 with a $3.6 million annual long-term incentive grant, while Cremers received a one-time cash payment of roughly $6.7 million in lieu of prior severance benefits.

One governance detail that may impact future flexibility is the supermajority requirement for leadership changes. This provision, combined with the balanced board, suggests a highly collaborative management approach is necessary to navigate the integration. The combined company aims to leverage its scale to optimize harvest schedules and land-based solutions, such as its climate mitigation business. The geographic diversity across the two most productive timber regions in the U.S. provides a hedge against regional pricing volatility and logistics constraints.

About Rayonier

Rayonier is a land resources real estate investment trust (REIT) with a portfolio comprising over four million acres in the U.S. South and U.S. Northwest. The company is focused on managing its timberlands on a sustainable basis while optimizing its overall portfolio value by delivering land to its highest and best use. Rayonier also operates six sawmills, an industrial-grade plywood mill, residential and commercial real estate developments, and a rural land sales program. Rayonier is committed to corporate responsibility, third-party forest certification, and supporting climate change mitigation through its land-based solutions business. More information is available at www.rayonier.com.
  
Source: rayonier.com