Temple-Inland sees IP hostile bid
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Temple-Inland sees IP hostile bidAUSTIN, TX

- Wood industry and forestry firm International Paper commenced a hostile takeover effort for Temple-Inland, offering $30.60 a share, or $3.3 billion in cash. The move follows a friendly acquisition overture that was spurned by Temple-Inland in June.

 "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," said International Paper chairman and CEO John Faraci.

Temple-Inland, which has been resisting IP's offers for weeks, adopted a shareholders' rights plan in June as protective measure. Temple-Inland, based in Austin, TX, says 59,000-employee IP is pursuing it because its wood products markets are weaker owing to the housing crisis. Temple-Inland employs about 10,000.

Temple-Inland is in two major product lines reliant on forests and logging: corrugated packaging and building products. Its integrated corrugated packaging operation consists of seven mills and 58 converting facilities. The building products operation produces lumber and wood products for new home construction, commercial and repair and remodeling markets.

Despite its reluctance to accept the offer, Temple-Inland's board said it would review the IP bid. Last month, when IP made a friendlier approach, Temple-Inland issue a rebuttal suggesting the offer was much  too low. "We believe Temple-Inland's price expectations are unrealistic," IP's Faraci said.

Temple-Inland's product lines include particleboard and MDF panels for furniture, cabinets and fixtures, and lumber for residential and commercial construction markets. If the deal closes it will allow International Paper to regain a foothold in the lumber and board markets, which it exited during a previous restructuring.

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