Less than a year after the death of its founder, a Quebec forestry company finds itself on the edge of a precipice, the victim of falling wood prices and massive investment in Ontario.
The Forex Group’s second largest creditor, the government could lose up to $23.8 million in restructuring the company.
“The decline in market conditions [dans la deuxième moitié de 2022] resulted in a serious deterioration in the financial situation of Forex, which was aggravated by a dispute between the company and its shareholders,” wrote Claudio Filippone, of the accounting firm PwC, in a report filed in court last week. .
“As a result, Forex has not been able since August 2022 to convene its board of directors,” Mr. Filippone continued. This situation has affected management’s ability to make decisions on future projects and to deal with market difficulties. »
Died at 90
Forex was founded in 1957 by Jean-Jacques Cossette, a larger than life entrepreneur who died in February 2022 at the age of 90. A bon vivant, he owned a Bombardier Challenger private jet, Airbus helicopters and a penthouse in the Tour des Canadiens in Montreal.
“Despite all the pitfalls he could face, when he had an idea in mind, he kept going,” said yesterday at the Log Yolaine Rousseau, granddaughter of Mr. Cossette, who has been in charge of Forex since his death.
The company now has about ten shareholders, including brothers and nephews of Jean-Jacques Cossette.
“Different Views”
Photo taken from Forex website
Yolaine Rousseau
Patron of Forex
“After all, we are members of three different generations in the company. […] In my grandfather’s time, it was simple, there was only one generation and everyone had done it all their life. When you are down to three generations, there are different visions for the future,” said Ms.me Rousseau, without wanting to go into details.
Excited by the jump in lumber prices in the wake of the pandemic, Forex in 2021 acquired a plant in Wawa, northern Ontario, to convert it to the production of oriented strand board (OSB). This $250 million project, in which Forex has invested $90 million so far, has contributed to draining the company’s liquidity, admitted Yolaine Rousseau.
For the young leader, the priority is to preserve some 350 Forex jobs in the facilities of Amos, Ferme-Neuve, Mont-Laurier and Montreal, where the company’s head office is located.
“The primary objective right now is to maintain operations and jobs,” she insisted. Should potential buyers be found for certain factories or for all the factories? Find investors? All options are on the table. »
FOREX, A LONG HISTORY
1957
Jean-Jacques Cossette had a first sawmill built in Champneuf, Abitibi.
1975
Forex is partnering with the French group Le Roy to establish a particle board plant in Val-d’Or.
1984
Listed on the stock exchange for a few months, Forex is experiencing financial difficulties.
1989
Taking advantage of the strength of the market, Forex sells its sawmills.
1992
Forex returns to the industry by buying a sawmill in Saint-Michel-des-Saints.
1993
Forex acquires an oriented strand board (OSB) factory in Saint-Michel-des-Saints, then another in Chambord (1994).
1997
Forex inaugurates a new OSB plant near Maniwaki.
1999
Forex sells its assets to American giant Louisiana-Pacific for $759 million, allowing the Cossette family to pocket around $390 million.
2008
Forex once again returned to the industry by acquiring a sawmill in Ferme-Neuve, then facilities in Mont-Laurier.
2015
Quebec is investing $18 million in Forex’s relaunch of the Temlam OSB panel plant in Amos, a $70 million project.
2022
Death of Jean-Jacques Cossette in Val-d’Or.
2023
Accumulating debts of nearly $90 million, Forex protects itself from its creditors.
Sources: Forex, Forest History of Abitibi-Témiscamingue