- --------------------------------------------------------------------------------




                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM 8-K


                CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                       THE SECURITIES EXCHANGE ACT OF 1934




       Date of Report (date of earliest event reported): November 19, 1999




                           MAXXAM GROUP HOLDINGS INC.
             (Exact name of Registrant as Specified in its Charter)



                                    DELAWARE
                 (State or other jurisdiction of incorporation)




                                    333-18723
                            (Commission File Number)



                                   76-0518669
                     (I.R.S. Employer Identification Number)




                           5847 SAN FELIPE, SUITE 2600
                                 HOUSTON, TEXAS
                    (Address of Principal Executive Offices)
                                      77057
                                   (Zip Code)


       Registrant's telephone number, including area code: (713) 975-7600


- --------------------------------------------------------------------------------


ITEM 5.  OTHER EVENTS

      The Registrant (the "Company") is the indirect parent of The Pacific
Lumber Company ("Pacific Lumber"). On March 1, 1999, Pacific Lumber, Salmon
Creek Corporation, a wholly owned subsidiary of Pacific Lumber ("Salmon Creek"),
and Scotia Pacific Company LLC, another wholly owned subsidiary of Pacific
Lumber ("Scotia LLC"), consummated the Headwaters Agreement with the United
States. Pursuant to the Headwaters Agreement, Salmon Creek received $299.9
million in cash, $15 million of which was utilized to defray expenses in
connection with negotiation and consummation of the Headwaters Agreement and the
balance of which was placed into escrow (the "Escrowed Funds") to be used to
support the timber collateralized notes of Scotia LLC (the "Timber Notes").

      Attached hereto as Exhibit 99.1 is a press release announcing that the
Escrowed Funds have been released and that $169 million has been placed in a
reserve account to support payments on the Timber Notes. Attached hereto as
Exhibit 99.2 is a letter to holders of Timber Notes setting forth additional
information regarding this reserve account, which is known as the Scheduled
Amortization Reserve Account.

                                   SIGNATURES

      Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.





Date:  November 19, 1999
                                            MAXXAM GROUP HOLDINGS INC.
                                                   (Registrant)


                                    By:       /s/ Paul N. Schwartz
                                                 Paul N. Schwartz
                                    Vice President and Chief Financial Officer