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. Last Updated: 07/27/2016

Willamette,Weyerhaeuser Near $6.1Bln Timber Deal

NEW YORK -- Forest products company Willamette Industries Inc. on Monday said it tentatively accepted a sweetened $6.1 billion offer from larger rival Weyerhaeuser Co., potentially ending one of the longest-running hostile U.S. takeover battles in recent memory.

If approved by Willamette's board later this month, the deal would create a paper industry titan controlling more than 3 million hectares of timberland in the United States alone. The companies' combined revenue of about $20 billion would rank it only behind rivals International Paper Co. and Georgia-Pacific Corp.

In conjunction with the decision to accept the Weyerhaeuser bid "in principle," Willamette also said it would end its ongoing negotiations to acquire Georgia-Pacific's massive building-products unit.

The GP operation would have more than doubled Willamette's size, but some analysts and investors questioned whether such a deal would provide more shareholder value than merging with Weyerhaeuser.

Willamette's decision to accept the slightly sweetened $55.50-per-share, all-cash offer comes just 17 days after its board rejected a $55-per-share, or $6.04 billion, bid from Weyerhaeuser as inadequate.

Company officials from both sides declined to comment on the revised bid and tentative acceptance.

If a deal is ultimately struck, it would end one of the longest-running hostile takeover battles in recent memory.

Federal Way, Washington-based Weyerhaeuser launched its hostile bid in November 2000 after Willamette's board rejected an unsolicited offer of $43 per share, worth about $4.7 billion.

Weyerhaeuser raised its bid four times and also won a bitter proxy battle last June to obtain three seats on Willamette's nine-member board. Weyerhaeuser has been promising a similar board battle this spring if no agreement could be reached before then.