Tembec's sale of Temrex complete

Tembec has concluded the sale of its 50% equity interest in Temrex Forest Products LP (“Temrex”) to subsidiaries of Société générale de financement du Québec (“SGF”) for $11.6 million in cash. Temrex has been operated as a sawmilling joint venture with the SGF in Quebec’s Gaspé region since 2002.

Produits Forestiers Saint-Alphonse Inc. (“PFSA”) purchased Tembec’s 32,800,000 units in Temrex and SGF Rexfor Inc. (“Rexfor”) purchased Tembec’s 50 common shares in Gestion PFT Inc., the general partner of Temrex. PFSA and Rexfor are subsidiaries of SGF. The purchase price is subject to a post-closing downwards adjustment of not more than $500,000.

The sale of Tembec’s interest is part of the Company’s initiatives to generate approximately $100 million of incremental liquidity. Including this sale, approximately $26 million will have been achieved since the initiatives were first announced in April 2009.

As a result of the sale, Tembec will record a gain of approximately $6 million in its September 2009 quarterly financial statements.

Source: Tembec