SEATTLE — Willamette Industries said Friday that its board has rejected Weyerhaeuser Co.’s takeover bid of $55 a share as inadequate and has cut off discussions about a buyout.
The board strongly urged shareholders not to tender any shares to timber rival Weyerhaeuser, which has been trying for more than a year to take over Portland-based Willamette.
Willamette said that after evaluating its strategic alternatives, it has decided to continue talks with Georgia-Pacific Corp. about combining building materials businesses.
Willamette for months has fought Weyerhaeuser’s takeover bid, arguing that the price was too low. The $55 a share offer had been increased from $50 last month.
But it wasn’t enough.
"During our discussions with Weyerhaeuser and its advisers, we made a good-faith effort at establishing a constructive dialogue and provided information regarding synergies, which we estimate to be in excess of $400 million," said board chairman William Swindells.
"However, it became clear to us that Weyerhaeuser would not consider our new information and were not willing to increase their offer, which we continue to believe is inadequate," he said.
Weyerhaeuser told Willamette earlier this week that it saw no reason to increase the $55-a-share hostile takeover bid, despite information provided by Willamette in an attempt to get the bid sweetened.
Weyerhaeuser chairman Steven Rogel said Willamette outlined several areas where it thought Weyerhaeuser could save money from the merger. But Rogel said the estimated savings were either unattainable or based on outdated information.
Weyerhaeuser, headquartered in Federal Way, has expressed strong opposition to the Willamette deal with Georgia-Pacific Corp.
The deal to acquire Willamette was recently valued at $7.6 billion, including the assumption of $1.53 billion in debt.
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