Though Temple-Inland refused two previous purchase offers from International Paper, the extension of a third and revised merger agreement met with approval.
What the agreement means for the local Temple-Inland factory is unclear. Attempts to reach Plant Manager Marc Cates were unsuccessful as he is on vacation this week. Temple-Inland employee Becky Moore, who declined to provide her job title, referred all questions to corporate offices.
"We are not at liberty to talk about that so you'll have to talk to our corporate office," Moore said.
Messages left at the T-I corporate office Monday and Tuesday were not returned by press time.
A spokesperson in media relations for International Paper said it is too early in the deal to know the future of individual Temple-Inland factories.
According to the press release from International Paper, the company will acquire all of the outstanding common stock of Temple-Inland for $32 per share in cash, plus the assumption of $600 million in Temple-Inland's year-end debt. The total transaction value is approximately $4.3 billion, according to the release.
Previous offers from International Paper would have paid $30.60 per share, according to press releases on Temple-Inland's company website. However, the releases announced Temple-Inland's board of directors rejected International Paper's "unsolicited tender offer(s)."
"Temple Inland's Board of Directors, after careful consideration with its independent financial and legal advisors, voted unanimously to reject International Paper's proposal after the board determined unanimously that the proposal grossly undervalues Temple-Inland and is not in the best interest of Temple-Inland's stockholders," according to a June 6 release.
A similar statement was made in a July 18 release.
A press release regarding the acceptance of International Paper's revised offer could not be located on Temple-Inland's website.
The acquisition of Temple-Inland by International Paper "brings together two strong North American corrugated packaging businesses to create an even stronger company," according to the release found on International Paper's website.
"It offers numerous benefits for the shareholders and customers of both companies and is consistent with International Paper's focus on achieving and sustaining cost of capital returns throughout the cycle," according to the release.
The transaction is expected to close in the first quarter of 2012.
"The strategic benefits of this combination are clear and we are pleased to be able to move forward on terms that are financially attractive for both sets of shareholders," International Paper Chairman and CEO John Faraci said. "Acquiring Temple-Inland enhances our ability to generate additional cash flow while maintaining our strong balance sheet. We look forward to working with the employees of Temple-Inland as we integrate our businesses and create an even stronger company with substantial benefits for our customers, employees and shareholders."
Temple-Inland Chairman and CEO Doyle R. Simons also issued a statement through the release.
"This transaction creates value for both Temple-Inland and International Paper shareholders," he said. "The combined company will be positioned to be a leader in providing high quality products for its customers."
According to the release, the deal is expected to "yield synergies of approximately $300 million annually within 24 months of closing derived primarily from the areas of operations, freight logistics, selling expense and overhead."