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IP Proposes to Acquire Temple-Inland for $30.60/Share in Cash

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International Paper, Memphis, Tenn., USA, this week announced that it has proposed to acquire all of the outstanding shares of Temple-Inland for $30.60 per share in cash. Under terms of the proposal, the offer represents a 44% premium to Temple-Inland's price as of noon EDT, June 6th, ($21.21). International Paper's offer, which is backed by committed financing from UBS Investment Bank, is contingent on appropriate documentation and regulatory approval, which IP believes can be obtained.  

IP first communicated its proposal verbally to the chairman of Temple-Inland on May 17. Subsequently, there has been a call, a face-to-face meeting between the two sides, and two letters of correspondence from the chairman of IP to the chairman of Temple-Inland. IP was informed in a letter from Temple-Inland's chairman, dated June 4, that the board of Temple-Inland has unanimously rejected its proposal. In response, IP today sent a letter to Temple-Inland expressing its continued interest in pursuing an acquisition.

IP chairman and CEO John Faraci said that "we are very disappointed with the response of Temple-Inland's Board of Directors. We believe that our proposal offers clearly superior and compelling value to Temple-Inland's shareholders. Our proposal  reflects the future business plans and economic outlook for Temple-Inland and for the sector, and incorporates a significant portion of the cost savings resulting from the merger of International Paper and Temple-Inland, while at the same time creating value for International Paper shareholders."

The offer reflects the potential cyclical improvement in Temple-Inland's building products segment and IP's willingness to share a portion of the significant synergies available from the transaction with Temple-Inland shareholders. IP said that it is prepared to consider all alternatives to successfully complete this transaction.


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