Displaying items by tag: TempleInland

International Paper Company and Temple-Inland Inc. have announced that they have reached an agreement with the Antitrust Division of the U.S. Department of Justice ("DOJ") with respect to International Paper's acquisition of Temple-Inland.  As part of the agreement, the DOJ has entered into a consent decree with International Paper and Temple-Inland that allows the combination to proceed.  The companies expect to complete the transaction promptly.

Under the terms of the consent decree filed in federal court in the District of Columbia, the combined company will undertake the post close divesture of 970,000 tons of containerboard mill capacity within four months, with the possibility of two 30-day extensions. The company agreed to divest Temple-Inland's facilities in OntarioCalifornia and New Johnsonville, Tennessee, and International Paper's facility in Hueneme, California.  International Paper reaffirms that it expects to achieve at least $300 million of synergies within twenty-four months of closing.

International Paper Chairman and CEO John Faraci said, "We are pleased to have reached an agreement with the DOJ that addresses their concerns and preserves the value in the combination of these two fine companies. As we take the final steps to closing, we look forward to a smooth integration and to realizing the substantial benefits this transaction provides our customers, employees and shareholders."

Published in North American News

Temple-Inland Inc. announced that at its Special Meeting of Stockholders held today, Temple-Inland stockholders voted to approve the adoption of the merger agreement with International Paper Company (IP), with 86,908,118 shares of Temple-Inland common stock voting in favor of the merger, representing over 98 percent of the shares voted. All other matters submitted to a vote of the stockholders were also approved.

Completion of the merger is subject to other customary closing conditions, including the receipt of regulatory approval.

About Temple-Inland Inc.

Temple-Inland Inc. is a manufacturing company focused on corrugated packaging and building products. The fully integrated corrugated packaging operation consists of 7 mills and 57 converting facilities. The building products operation manufactures a diverse line of building products for new home construction, commercial and repair and remodeling markets. Temple-Inland's address on the World Wide Web is www.templeinland.com.

alt

SOURCE: Temple-Inland Inc.

Published in North American News

Temple-Inland Inc. has provided an update on the shutdown of its Bogalusa, Louisiana paper mill following an operational issue at the mill and its waste-water treatment facility.

Predictive testing for Biochemical Oxygen Demand (BOD) indicated that the Bogalusa mill would exceed its maximum daily permit levels for discharge to the Pearl River from the mill's waste-water treatment facility. The Company believes that this exceedance may have depleted the oxygen level in part of the river below that necessary to sustain a healthy fish population and resulted in a fish kill.

On Saturday, August 13, 2011, upon receiving the results of predictive testing, Temple-Inland immediately shut down the mill. The Company promptly informed the Louisiana Department of Environmental Quality (DEQ) of the situation and began taking corrective actions to restore the water quality of the River.

Temple-Inland's Chairman and CEO Doyle R. Simons said, "The health of the Pearl River and surrounding communities are our utmost concerns. Temple-Inland has a strong environmental record and we sincerely regret this incident, which is contrary to our culture of good community stewardship as both an employer and a resident of Bogalusa and the State of Louisiana.

"We never lose sight that we are members and supporters of the Bogalusa area and apologize for the impact this issue at the mill has had on the Pearl River, its aqua culture and surrounding communities. We are working diligently and expeditiously to remove the fish kill and restore the quality of the River," Simons concluded.

Published in North American News

International Paper has announced that it has determined to extend the expiration date for now of its tender offer for all outstanding common shares of Temple-Inland Inc. (NYSE: TIN) for $30.60 in cash. Accordingly, the offer and withdrawal rights are now scheduled to expire at 5 p.m., Eastern Time on September 8, 2011, unless further extended. The tender offer was previously scheduled to expire at 5 p.m., Eastern Time on Aug. 9, 2011.

Based on a preliminary count by the depositary for the tender offer, approximately 8.5 million shares of Temple-Inland common stock have been tendered and not withdrawn to date. Except for the extension of the expiration date, all other terms and conditions of the tender offer remain unchanged. If the tender offer is extended further, International Paper will issue a press release announcing the extension at or before 9 a.m., Eastern Time, on the next business day after the date the tender offer was scheduled to expire.

Temple Inland's stockholders may obtain copies of all of the offering documents free of charge at the SEC's website (www.sec.gov) or by directly requesting copies of all of the offering documents free of charge at Innisfree M&A Incorporated, the Information Agent for the offer, at (877) 456-3488 (toll-free). Banks and brokers may call collect at (212) 750-5833.

International Paper's dealer managers for the tender offer are UBS Investment Bank and Evercore Partners. Its legal advisor is Debevoise & Plimpton LLP.

SOURCE International Paper

Published in North American News

Board of Directors Unanimously Determines that IP's Offer Grossly Undervalues Temple-Inland and Urges Stockholders Not to Tender Shares Pursuant to IP's Offer

 

Temple-Inland Inc. today announced that its Board of Directors, after careful consideration with its independent financial and legal advisors, voted unanimously to reject the unsolicited tender offer from International Paper Company to acquire all outstanding common shares of Temple-Inland at a price of $30.60 per share in cash. The Board unanimously determined that the offer grossly undervalues Temple-Inland and is not in the best interests of Temple-Inland's stockholders.


The Board unanimously recommends that Temple-Inland stockholders not tender their shares into IP's offer.

The basis for the Board's recommendation with respect to IP's tender offer is set forth in Temple-Inland's Schedule 14D-9, filed today with the Securities and Exchange Commission ("SEC"), a copy of which is available at www.sec.gov and on Temple-Inland's website at www.templeinland.com.

 

"Since we launched the 'new' Temple-Inland in January 2008, we have delivered superior results to our stockholders compared with our corrugated packaging peers, building products peers, and the S&P 500. The Temple-Inland Board is unanimous in its belief that the offer grossly undervalues Temple-Inland and its prospects, including its position as the return on asset leader in the corrugated packaging industry, expected benefits from box plant transformation, its low-cost building products operation, and its strategic place within the industry as the third largest producer of corrugated packaging in North America," said Doyle R. Simons, Chairman and Chief Executive Officer of Temple-Inland.

 

As fully outlined in Temple-Inland's Schedule 14D-9, Temple-Inland's Board recommends that Temple-Inland stockholders not tender their shares into IP's offer because:

 

  • International Paper's unsolicited offer grossly undervalues Temple-Inland and its future prospects:
    • The Board believes Temple-Inland's accelerating growth of earnings and return on investment will result in superior value to Temple-Inland's stockholders as compared to the price being offered by IP.
    • IP overstates Temple-Inland's net debt. The Company's net debt at the end of first quarter 2011 was $737 million, not $828 million as IP calculated for purposes of pricing its offer.
    • IP wrongly characterizes Temple-Inland's timber financing transaction as a liability rather than an asset. IP appears to have considered only one aspect of the transaction, the present value of the settlement of the tax on the deferred gain, and ignored the remaining positive components (including alternative minimum tax credits) of the transaction, which together result in a net benefit.
    • IP's offer fails to appropriately compensate Temple-Inland stockholders for the very significant synergies that IP would realize and the extraordinary level of earnings accretion that would result if an IP/Temple-Inland transaction were to occur.
    • IP seeks to compare its offer price to valuation metrics from so-called "precedent" transactions that involved underperforming assets of other companies that are not comparable to Temple-Inland and its industry-leading returns, high-quality assets and low-cost structure.
    • IP's offer does not appropriately reflect the fundamental changes and improved focus in the corrugated packaging industry. These fundamental changes and improved industry focus are expected to be beneficial to Temple-Inland, which, as a result of its strong position in the corrugated packaging industry and its low-cost operations, is well positioned to continue to achieve improving results.
    • Temple-Inland is the largest remaining independent, publicly-held industry participant whose acquisition would fundamentally transform the industry, and IP's offer does not appropriately compensate Temple-Inland's stockholders for that strategic value.

 

  • The timing of International Paper's unsolicited proposal is extremely opportunistic and disadvantageous to Temple-Inland stockholders:
    • Housing markets are at historically low levels, temporarily depressing the value of our building products operations. IP is attempting to take advantage of our stockholders by moving to grab Temple-Inland at a bargain price at a time when there is little or no market value being ascribed to building products.
    • As IP itself has consistently highlighted to the investment community, corrugated packaging demand remains below prerecession levels, but is expected to recover in the near future as the economy continues to improve. IP is attempting by its offer to acquire Temple-Inland before corrugated packaging demand returns to prerecession levels and pricing further improves.
    • We estimate that $90 million of the annual cost savings from our Box Plant Transformation II project are still to be realized - our stockholders, not IP's, deserve to receive the benefit of the significant capital we have invested in this project.
    • IP initially publicized its proposal to acquire Temple-Inland during a period of market weakness in order to claim an inflated "premium".

 

  • The potential acquisition is subject to regulatory and other uncertainty:
    • IP is proposing a combination of the largest and third largest producers of corrugated packaging in North America.
    • Given the regulatory uncertainty and the significant conditionality of IP's offer, there is considerable uncertainty regarding the offer and the timing of Temple-Inland stockholders receiving the "certain" value that IP claims to be offering.

As noted above, the Company's Schedule 14D-9 is available on the SEC's website, www.sec.gov. In addition, the Schedule 14D-9 and other materials related to IP's unsolicited proposal are available in the "Investor Relations" section of the Company's website at www.templeinland.com. The Company urges stockholders to read the Schedule 14D-9 carefully and in its entirety.

 

Goldman, Sachs & Co. is acting as financial advisor to Temple-Inland, and Wachtell, Lipton, Rosen & Katz is acting as Temple-Inland's legal counsel.

 

SOURCE: Temple-Inland Inc.

Published in North American News

Temple-Inland Inc. has acknowledged that International Paper Company (NYSE: IP) announced that it will be commencing an unsolicited offer to acquire all of the outstanding shares of common stock of Temple-Inland for a price of $30.60 per Temple-Inland share in cash.

 

Consistent with its fiduciary duties and as required by applicable law, Temple-Inland's Board of Directors will review the offer to determine the course of action that it believes is in the best interests of the Company and its stockholders. Temple-Inland's stockholders are advised to take no action at this time pending conclusion of the review of the tender offer by Temple-Inland's Board of Directors.

 

Temple-Inland's Board of Directors, in consultation with its independent financial and legal advisors, intends to advise stockholders of its formal position regarding the announced offer within ten business days from the date of commencement of the unsolicited tender offer by making available to stockholders and filing with the U.S. Securities and Exchange Commission (the "SEC") a Solicitation/Recommendation Statement on Schedule 14D-9.

 

Goldman, Sachs & Co. is acting as financial advisor to Temple-Inland, and Wachtell, Lipton, Rosen & Katz is acting as Temple-Inland's legal counsel.

Published in Financial News

International Paper Company announced yesturday that it is commencing a fully financed tender offer for all outstanding common shares of Temple-Inland Inc. (NYSE: TIN) for $30.60 per share in cash. The all-cash offer represents a 46% premium to Temple-Inland's closing price on June 6, 2011, the last trading day prior to public disclosure of International Paper's proposal to acquire Temple-Inland. The offer will commence tomorrow and will expire at 5:00 p.m.New York City time on August 9, 2011, unless extended.

 

International Paper chairman and CEO John Faraci said, "We believe Temple-Inland's price expectations are unrealistic and their unwillingness to engage in any meaningful discussions with respect to value has left us with no alternative but to make our offer directly to Temple-Inland shareholders. While we prefer to reach a negotiated, friendly deal, we are committed to remaining disciplined and completing this transaction at a fair price for both companies' shareholders. We are confident in our ability to secure the necessary regulatory approvals to complete this transaction in a timely manner."

 

Faraci continued, "We respect Temple-Inland, but we disagree on the realistic standalone value of the company, which we believe is currently $21 to $24 per share. The premium we are offering is substantial, the multiple is well above recent directly comparable transactions, and we are providing Temple-Inland shareholders the certainty of cash in the midst of a very uncertain economic environment. At $30.60, we believe our offer fully reflects the future business plans and economic outlook for Temple-Inland and for the sector, including the current environment and outlook for containerboard, the potential cyclical improvement in Temple-Inland's building products segment and near-term expected increases in Temple-Inland's earnings. We are confident that Temple-Inland shareholders support a transaction, and it is now incumbent upon the Temple-Inland Board to take the next step."

 

International Paper noted that its fully financed, all-cash offer represents compelling value when compared against all reasonable metrics and precedents, including:

 

  • -A 46% premium to Temple-Inland's closing price of $21.01 on June 6, 2011, the last trading day prior to public disclosure of the offer
  • -A 30% premium over the present value of average analyst price targets for a standalone Temple-Inland of $23.57
  • -A highly attractive multiple of 9.8x Temple-Inland's 2011 estimated EBITDA (9.0x excluding timber tax liability) versus forward EBITDA multiples of recent precedent transactions of -6.1x for Smurfit-Stone and 6.3x for Weyerhaeuser's corrugated packaging business, and well above Temple-Inland's average forward EBITDA multiple of 6.1x since 2008
  • -The fact that IBES research estimates for Temple-Inland's EBITDA have come down since International Paper's proposal was made public, given market expectations
  • -A significant premium to Temple-Inland's standalone value which, based on pre-offer trading and independent analyst estimates of Temple-Inland's earnings potential, International -Paper and third parties credibly estimate at $21 to $24 per share. This compares to Temple-Inland's contention that standalone value should reflect multiple expansion to near 7x applied to an above-average estimated EBITDA for 2012 - a view we believe neither investors nor third parties share
  • -Realization of the benefits from a potential cyclical improvement in Temple-Inland's building products segment, even with a recovery uncertain and likely years away
  • -The benefits of more than half of the synergies that are expected to result from the combination
  • -The certainty of cash, versus the uncertainty of any potential future benefits to shareholders that Temple-Inland's current business plan may, or may not, deliver through cyclical and operational improvement

 

International Paper has secured committed financing from UBS Investment Bank, and the offer will not be conditioned on financing. The offer will be conditioned on there being validly tendered and not withdrawn at least a majority of the total number of Temple-Inland shares outstanding on a fully diluted basis, Temple-Inland's Board of Directors redeeming or invalidating its "poison pill" shareholder rights plan, the receipt of regulatory approvals and other customary closing conditions as described in the Offer to Purchase.

 

International Paper also is filing notification tomorrow with the Federal Trade Commission ("FTC") and Department of Justice ("DOJ") as required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR). The HSR waiting period will expire on July 27, 2011 unless extended by the FTC or DOJ, which would not be unusual in these circumstances.

 

The Offer to Purchase, Letter of Transmittal and related documents will be filed tomorrow with the U.S. Securities and Exchange Commission (SEC). Temple-Inland's stockholders may obtain copies of all of the offering documents free of charge at the SEC's website (www.sec.gov) or by directly requesting copies of all of the offering documents free of charge at Innisfree M&A Incorporated, the Information Agent for the offer, at (877) 456-3488 (toll-free). Banks and brokers may call collect at (212) 750-5833. The tender offer will expire at 5:00 p.m.New York City time on August 9, 2011, unless extended in the manner set forth in the Offer to Purchase.

 

International Paper's dealer managers for the tender offer are UBS Investment Bank and Evercore Partners. Its legal advisor is Debevoise & Plimpton LLP.

Published in Financial News