Template-Inland resists bid by International Paper

Paper Recycling  |  2011-06-08 04:59:39   |   By

Austin-based Temple-Inland Inc. resisted a $3.31 billion takeover bid from International Paper Co.

MEMPHIS (Scrap Monster): Austin-based Temple-Inland Inc. resisted a $3.31 billion takeover bid from International Paper Co.

International Paper Co. made a proposal to Temple-Inland Inc. in a move that involves two companies heavily involved in recycled fiber. International Paper offered $30.60 per share for Temple-Inland, a 44% premium to the company’s share price.

As reported by Waste & Recycling News, Temple-Inland maintains that International Paper's offer undervalues the company. It also believes that a merger would create too much consolidation in the packaging business and could raise concerns with antitrust regulators.

Template-Inland has adopted poison pill measures to fend off a takeover. The measure gives existing shareholders the right to buy an equal number of preferred shares, if someone tries to acquire 10 percent or more of the company, which would dilute the acquirer's stake.

In 2008, International Paper became a large player in the recycled paper market through its acquisition of Weyerhaeuser Co.’s containerboard, packaging and recycling division. The company collects, consumes and markets more than 6 million tons of recycled paper each year.