Lyman Lumber Co. announced it has begun Chapter 11 bankruptcy proceedings on Thursday and that it entered into a letter of intent to sell its Midwest operations to SP Asset Management LLC., an affiliate of of Steel Partners Holdings L.P., a New York City-based global diversified holding company.

"We are very excited about the prospect of working with a string and credible financial partner," said Jim Hurd, president and CEO of Lyman Lumber, in a press release. "The sale would allow Lyman to continue to provide market leading service to our customers."

Lyman Lumber, the No. 21 company on the latest ProSales 100 listing, said the sale is subject to approval from both parties and the bankruptcy court. The company operates six Midwest divisions that cater to professional contractors and lumber dealers with services such as supplying building materials and jobsite labor.

"Although we are very involved in this reorganization, our primary focus is on our customers and we do not anticipate any disruption in service, in fact, it will appear like business as usual to our customers," said Hurd.

Hurd said the sale will allow Lyman Lumber to unload some of its non-performing assets and services and work to secure long-term financing needed to help the company grow. Hurd said the company's land position and construction lending portfolio were the two largest strains on the company and will be part of the assets divested.

"We are excited to have the opportunity to acquire Lyman Lumber, said Steel Partners' president Jack Howard. "They have an outstanding brand, operation and staff. Despite the impact the housing crisis has had on Lyman, we believe that with its strong relationships with customers, suppliers and employees, and strong capital partner, Lyman would be well positioned to succeed in the future."