board agrees to buyout
After 14 months of resistance, the board of Portland-based Willamette Industries Inc. unanimously agreed to a buyout by Weyerhaeuser Co.
In a cash acquisition, Weyerhaeuser will acquire Willamette's outstanding shares for $55.50 per share, or $6.2 billion, and will also assume $1.7 billion in the Portland company's debt. Willamette shareholders have until next Friday to tender their stock.
Until recently, Willamette's board rejected the hostile takeover that Weyerhaeuser initiated in November 2000. William Swindells Jr., chairman of Willamette's board of directors, said this week that company leaders changed their minds and decided to accept the offer in the interest of shareholders.
The combined company will benefit from making use of both firms' best practices, according to Steve Rogel, the Weyerhaeuser chairman, president and chief executive officer. Rogel also is a former Willamette CEO.
Willamette Industries owns 106 mills in the United States, Canada, Mexico and Ireland, and 1.7 million acres of forestland in the United States. It had sales of $4.5 billion last year.
Weyerhaeuser, with offices or operations in 17 countries, reported $14.5 billion in sales last year.
large losses for 2001
Portland-based Louisiana-Pacific Corp. blamed a combination of low commodity prices and losses resulting from exiting the pulp business this week for a net loss in 2001 of $172 million, or $1.64 cents per share, on sales of $2.4 billion.
That compares with a net loss in 2000 of $14 million, or 13 cents per share, on sales of $2.9 billion.
'Weak commodity pricing reduced our operating earnings by about $200 million in 2001 compared with the prior year,' said Mark Suwyn, L-P's chairman and chief executive officer. Getting out of the pulp business also reduced gross sales, producing losses of more than $100 million, he said.
Suwyn found a silver lining in the weak pricing, however: It has accelerated the substitution of the company's largest product line, oriented strand board, for plywood. 'There are early signs that supply and demand may come into better balance this year,' he said.
In the fourth quarter of 2001, L-P posted a loss of $71 million, or 68 cents per share, on sales of $516 million versus a loss of $52 million, or 52 cents per share, on sales of $569 million for the same period last year.
The company cut costs last year, it reported, by curtailing production at several mills and eliminating more than 260 mid- and upper-level management positions. It expects the layoffs to save about $18 million a year. LP spokesman David Dugan said more than half of those layoffs were in the Portland corporate office.
The Greenbrier Companies, a Lake Oswego-based manufacturer of rail freight cars, is scaling back operations at its Polish and German facilities.
Greenbrier said it has laid off about 200 workers and consolidated some of its operating, finance and marketing divisions in hopes of saving about $4.5 million a year. In the past 3 1/2 years, the company has boosted sales in Europe to more than $100 million.
Greenbrier President William Furman says the company was briefly profitable in Europe last year but experienced a setback after the Sept. 11 attacks and the general economic slump. Its European operations lost $6.5 million in 2001.
Chief Financial Officer Larry Brady said he expects the company to rebound this year.
Ñ Nevill Eschen