Georgia-Pacific, a manufacturer of tissue, packaging, paper, building products, and Koch Industries have reached an agreement for Koch Forest Products to make a $48 per share cash tender offer for all shares of Georgia-Pacific. The transaction has been unanimously approved by the boards of directors of Georgia-Pacific and Koch.
The transaction has an equity value of $13.2 billion and a total enterprise value of $21 billion, including all Georgia-Pacific debt. The price to Georgia-Pacific shareholders represents a premium of 39 percent based on the closing price of Georgia-Pacific common stock on November 11.
Koch Forest Products expects to launch a cash tender offer for all outstanding shares of Georgia-Pacific common stock no later than November 18. The closing of the tender offer is expected to be completed soon, subject to customary closing conditions, including antitrust clearances in various countries.
Koch has confirmed that Georgia-Pacific will be operated as a privately held, wholly owned subsidiary of Koch Industries. Georgia-Pacific will continue to do business worldwide under the Georgia-Pacific name and continue to operate its businesses from its Atlanta headquarters as an independently managed company.
Included in the transaction are all assets of Georgia-Pacific, including its North America and international consumer products segments, as well as its building products, packaging, and paper and bleached board segments.
Koch acquired Georgia-Pacific’s non-integrated market and fluff pulp operations at New Augusta, Mississippi, and Brunswick, Georgia, in May 2004. Since the purchase, Koch has invested in these businesses, which have been operating as Koch Cellulose. Upon completion of this transaction, these operations will be reintegrated with Georgia-Pacific businesses.