Louisiana-Pacific Corp. (NYSE: LPX), Nashville, TN, and Ainsworth Lumber Co. Ltd. (TSX: ANS), Vancouver, British Columbia, announced they are terminating their previously announced agreement in which Louisiana-Pacific would acquire all of the outstanding common shares of Ainsworth.
LP and Ainsworth have determined that the regulatory approvals (including in particular expiration of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvement Act and approval under the Canadian Competition Act) cannot be obtained without divestitures significantly beyond those contemplated in the arrangement agreement without engaging in lengthy and expensive litigation with the regulatory authorities in the U.S. and Canada.
“We believe this transaction would have led to positive outcomes for customers, employees and shareholders, and fundamentally disagree with the analysis by antitrust agencies of the competitive dynamics of our industry," said Curt Stevens, Louisiana-Pacific’s CEO. "We will continue to compete on a continent-wide basis but feel we have no choice but to terminate the agreement rather than accept the distraction, disruption, costs and risk of litigating this matter in both the U.S. and Canada, where the process could take upwards of a year.”
LP and Ainsworth mutually agreed to terminate the agreement under these conditions. According to the terms of the arrangement agreement, no termination fee will be payable by either party.