Says Proxy Monitor Ignores Hard Economic Facts
PORTLAND, Ore., May 24 /PRNewswire/ -- Willamette Industries (NYSE:WLL)
today issued the following statement regarding Proxy Monitor's recommendation
on the election of directors at Willamette's June 7, 2001 annual meeting.
Said Duane McDougall, President and Chief Executive Officer of Willamette,
"Proxy Monitor appears to have absorbed Weyerhaeuser's rhetoric but ignores
the hard economic facts behind our Board's carefully considered actions. We
have always said we would consider serious offers from anyone, but in our view
Weyerhaeuser's offers have simply not been in the ballpark. Indeed, we think
it is clear that most shareholders agree that Weyerhaeuser's offers have not
reflected the value of this company.
"Our board has never believed that Weyerhaeuser is willing to pay what we
believe is a fair value for Willamette. While saying publicly that they want
to do a deal quickly and hinting that they may offer more, they tell us
privately that nothing has changed and they have nothing new to say. That's
why we have not been willing to sit down with them."
Willamette noted a research report issued today by Mark Wilde of Deutsche
Banc Alex Brown Inc. that said, among other things:
"We think WY's calculation of the offer premium is skewed
-- focusing almost precisely on the sector's cyclical bottom."
"We wonder why Weyerhaeuser's synergies target on this deal (6.8%)
is below their own estimate of the industry average (7%)
-- seemingly, it ought to be higher."
"Finally, if Willamette is far and away the best fit for
Weyerhaeuser, is it unreasonable to assume some premium to other
industry transactions?"
"Once [Willamette] sits down to talk ..., much of their negotiating
room will be gone."
Said McDougall, "This fight has always been about value -- value that
Weyerhaeuser wants for its shareholders and value that we believe rightfully
belongs to Willamette's shareholders. Indeed, by our conservative
calculations, Weyerhaeuser's current offer would be at least 30% accretive to
Weyerhaeuser's cash earnings. We believe negotiating on that basis or
accepting an offer at that level would be irresponsible.
"Our directors are committed to delivering more value than Weyerhaeuser's
$50 per share offer. Recent investments are expected to increase cash flow by
30-40% over the next three years, and the Company will consider strategic
transactions, combinations and other value enhancing alternatives, including
share buy backs, at times that make sense for Willamette's shareholders, not
Weyerhaeuser's.
"In contrast, were Weyerhaeuser's nominees to be elected, they are
expected 'subject to their fiduciary duties' to vote for a deal with
Weyerhaeuser on Weyerhaeuser's terms. Indeed, Weyerhaeuser's proxy materials
suggest that, again subject to their fiduciary duties, Weyerhaeuser's nominees
would have been 'expected' to 'facilitate' the previous $48 offer, which we
regard as clearly inadequate."
McDougall continued, "Our board is going to fight this battle consistent
with its fiduciary obligations for as long as it takes."
Willamette urges its shareholders to vote for its nominees in the upcoming
proxy contest by returning the GREEN proxy card to Willamette or its proxy
solicitor, MacKenzie Partners, Inc. If shareholders have any additional
questions with respect to voting, they should call Willamette's proxy
solicitor, MacKenzie Partners, Inc. at 800-322-2885 (toll free) or
212-929-5500 (collect).
Willamette Industries is an integrated forest products company with
105 plants, located in the U.S., France, Ireland and Mexico. The company owns
1.7 million acres of forestland in the U.S. and manages it sustainably to
produce building materials, composite wood panels, fine paper, office paper
products, corrugated packaging and grocery bags.
Forward-looking statements in this release are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. Any
such forward looking statement made by Willamette with respect to the
Weyerhaeuser tender offer is not entitled to the benefit of the safe harbor
protections of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements are subject to risks and uncertainties and actual
results could differ materially from those projected. Such risks and
uncertainties include, but are not limited to, the effect of general economic
conditions; the level of new housing starts and remodeling activity; the
availability and terms of financing for construction; competitive factors,
including pricing pressures; the cost and availability of wood fiber; the
effect of natural disasters on the Company's timberlands; construction delays;
risk of nonperformance by third parties; and the impact of environmental
regulations and other costs associated with complying with such regulations.
Please refer to Willamette Industries' Securities and Exchange Commission
filings for further information.
SOURCE Willamette Industries
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Related links:
http://www.wii.com
CONTACT:
Greg Hawley, EVP & CFO, 503-273-5640, or
Cathy Dunn, VP Communications, 503-273-5642, both of Willamette
Industries; or Paul Verbinnen, or David Reno, or Jim Barron, all
of Citigate Sard Verbinnen, 212-687-8080, for Willamette
Industries
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