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Canfor's sawmill in Houston, B.C.

Patience and high lumber prices during the pandemic have paid off for a Canfor Corp. director who has sold a portion of her shares for $15.8-million.

Barbara Hislop balked at B.C. billionaire Jim Pattison’s bid in 2019 for full control of the Vancouver-based forestry company.

Her decision to keep her shares during a roller-coaster ride on lumber markets has started to reap rewards. She began selling some of her Canfor shares last month, as lumber prices soared to new highs.

In August, 2019, Ms. Hislop held about 2.5 million Canfor shares when Mr. Pattison made a cash bid of $16 a share for the 49.1 per cent of stock that he didn’t already own.

She sought an extra 29 cents a share for minority shareholders before she would even consider giving her support for the unsolicited bid, which Mr. Pattison launched during a low point in the commodity cycle.

Mr. Pattison, who owns 50.9 per cent of Canfor through Great Pacific Capital Corp. and affiliates, wouldn’t budge.

Ms. Hislop did not outright fight the bid, but she abstained from committing to vote her shares to back Great Pacific, in sharp contrast to all other Canfor directors who entered into pacts to support the go-private bid.

Her decision to stand her ground has turned out to be financially shrewd. She sold 555,400 Canfor shares between March 1 and April 9, at prices ranging from $26.60 to $30.71, according to the System for Electronic Disclosure by Insiders, or SEDI, Canada’s database for insider trades.

The partial divestment of Canfor shares translated into a payout totalling $15.8-million for her so far, or an average of $28.46 a share – 78 per cent higher than what she would have garnered if she had agreed to sell at $16 a share.

She has reduced her holdings by 22 per cent in the forestry company, but still owns 709,861 Canfor shares in her name and another 1,210,310 Canfor shares through 6R Investments Ltd., according to SEDI filings.

Canfor rose $2.12 to close at $31.85 a share on Friday on the Toronto Stock Exchange, edging toward the record high of $34.04 in June, 2018. Based on Friday’s close, Ms. Hislop’s remaining Canfor shares is worth $61.2-million.

Several institutional shareholders opposed Mr. Pattison’s bid for nearly 61.5 million Canfor shares. In late 2019, he abandoned his plans to take Canfor private, after minority shareholders narrowly rejected his cash offer.

Ms. Hislop has deep roots at Canfor. She worked at the company from 1977 to 2004, rising through the ranks, including her role as vice-president of operations. She is also the granddaughter of Canfor’s co-founder.

The past couple of years have been volatile for shareholders, including Mr. Pattison, who owns more than 63.7 million Canfor shares.

For a while, it looked like Canfor’s minority shareholders should have accepted the $16 a share because the company’s stock price fell sharply in the weeks and months after the billionaire withdrew his offer. Canfor plunged to as low as $6.11 on March 23, 2020.

In the spring of 2020, lumber producers scaled back their production amid faltering demand and tumbling wood prices as the COVID-19 pandemic delayed home renovations and housing starts.

Benchmark two-by-fours made from Western spruce, pine and fir, or SPF, sold for US$310 for 1,000 board feet in April, 2020, according to industry newsletter Madison’s Lumber Reporter.

After lumber markets slumped during the early stages of the pandemic, prices began jumping in July, 2020, as Canadians and Americans stuck at home embarked on do-it-yourself projects or hired contractors.

Madison’s Lumber Reporter said prices for Western SPF two-by-fours hit a record US$1,210 for 1,000 board feet this month, nearly quadruple the level compared with one year ago.

Canfor chief executive officer Don Kayne is bullish about lumber markets. Demand is being bolstered by homeowners building decks and making other improvements while housing starts are getting a boost from families seeking more space in the suburbs during the work-from-home phenomenon, he said.

“We’re going to have a pretty solid market here for the balance of this year,” Mr. Kayne said during a virtual conference webcast this month by the BC Council of Forest Industries.

Canfor has sawmills in Canada and the United States, and also owns 54.8 per cent of Canfor Pulp Products Inc. and 70 per cent of Swedish lumber producer Vida Group.

Ms. Hislop served as a director at Canfor Pulp for two years, before joining Canfor’s board in May, 2019. She will not be standing for re-election at Canfor’s virtual annual meeting next week.

“Ms. Hislop first served on the Canfor Pulp board from April, 2017, to April, 2019, and then joined the Canfor board. We thank her for her years of service,” Canfor spokeswoman Michelle Ward said in a statement to The Globe and Mail.

Canfor was co-founded in the late 1930s by Ms. Hislop’s grandfather, Poldi Bentley, and his brother-in-law, John Prentice.

Peter Bentley, who is the father of Ms. Hislop and son of Poldi Bentley, previously served as Canfor’s CEO for 10 years and chairman of the board of directors for 24 years.

Peter Bentley owns roughly 500,000 Canfor shares, SEDI filings show.

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