Federated Co-op selling to Gorman Bros. Lumber

Sale of Canoe operation, which is expected to be finalized in about two months, will retain jobs and wages.

By those involved, it’s being described as a win-win-win situation.

Federated Co-operatives Limited gets to divest itself of its forest products company, Gorman Bros. Lumber Ltd. can enhance its wood supply, and the more than 300 people employed by Federated’s Canoe operation get to keep their jobs and their wages.

Although it will likely be another two months at least before the transaction is finalized, Federated Co-operatives Limited has officially announced it has entered into an agreement to sell its Forest Products Division assets and operations at Canoe to Gorman Bros. Lumber Ltd. of Westbank.

“It’s an excellent opportunity for both Gorman and Federated Cooperatives,” said Darrell Embley, Federated’s vice-president of forest products, noting that Federated has wanted a buyer who would keep the operation running.

“They (Gorman) are great for the community, they’re not in the business of shutting operations down. We’re very, very pleased…”

Embley said Federated has been a good employer over time, but the federation doesn’t need to own a forest products company in order to supply forest products to its membership.

“It’s probably time to have this operation in the hands of a forest company who understands the business moving forward.”

Rick Scott, chief financial officer with Gorman Bros. Lumber, said Federated’s “fibre basket” or selection of timber, as well as its location, matches well with Gorman’s operations in the Okanagan and Revelstoke.

Gorman has lumber operations in Westbank and Revelstoke, as well as a pole division in Lumby. It also has a reloading site in Oroville, Wash.  The company employs about 800 people in B.C., including its logging contractors.

Scott says Gorman Bros. intends to retain jobs as well as maintaining wages and working conditions.

“That’s the intent. We’re still looking everything over, but we don’t see any reason to change.”

He said the company will consider further investment if necessary to make the plant more efficient.

Federated’s Forest Products Division has operated in Canoe since 1945.

The manufacturing facilities have a capacity of approximately 150 million board feet of lumber and 150 million square feet of plywood annually. The sawmill shut down on Dec. 21, 2007 because of economic conditions.

Embley, meanwhile, who’s been with the Canoe operation for three years, says he’s been asked to stay on in a similar capacity, which he is willing to do. He’s pleased with how his time  in Canoe has gone so far.

“There were major concerns here about the future of the division – we lost the sawmill, and if we were to lose the plywood plant and the forestry operations…

“I’m very pleased with my involvement over the last three years and what we’ve been able to achieve. It is a very good story.”