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Weyerhaeuser may up bid
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May 21, 2001: 12:18 p.m. ET
Company extends $5.5 billion offer for Willamette Industries until June 7
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NEW YORK (CNNfn) - Weyerhaeuser Co. indicated Monday that it would be open to raising its already sweetened $5.5 billion bid for Willamette Industries Inc.
Weyerhaeuser extended its $5.5 billion takeover offer for Willamette until midnight ET on June 7, when Thursday turns to Friday. The offer was scheduled to expire on May 18, at 12 midnight ET.
"If Willamette is prepared to negotiate a definitive merger agreement promptly, Weyerhaeuser is willing to increase its offer above $50 per share," Weyerhaeuser CEO and president Steven Rogel said in a statement.
Federal Way, Wash.-based Weyerhaeuser (WY: down $0.65 to $60.40, Research, Estimates) has been trying to buy Willamette, which makes paper products, since last year. Weyerhaeuser first made its $48 a share, or $5.24 billion bid for Portland, Ore.-based Willamette last November but was rejected. Earlier this month, timber company Weyerhaeuser again sweetened its offer to a $50 a share, or $5.5 billion, which was again rebuffed.
Willamette's shares have gained nearly 40 percent since Weyerhaeuser announced its initial offer last November.
Weyerhaeuser has always been open to raising its $5.5 billion offer if Willamette will agree to negotiate, a spokesman told CNNfn.com.
Willamette could not be reached for comment.
Acquiring Willamette would rank Weyerhaeuser as the world's third-largest paper and forestry products producer behind International Paper Co. (IP: up $0.08 to $40.38, Research, Estimates) and Georgia-Pacific Corp. (GP: up $0.44 to $35.99, Research, Estimates), with annual revenue in excess of $16 billion.
In the seven months of negotiations, Willamette (WLL: down $0.27 to $49.21, Research, Estimates) has adopted a poison pill and other defensive measures to thwart Weyerhaeuser. Willamette has maintained that it will not negotiate at "bargain-basement prices" and that the $5.5 billion bid does not reflect the value of the "premier franchise in the forest products industry."
Weyerhaeuser is now attempting to secure three board seats at Willamette's June 7 annual meeting. On Monday, the timber company again urged Willamette shareholders to vote for their slate.
If Weyerhaeuser fails to secure three seats it will pull out of the running for Willamette.
"If the Weyerhaeuser nominees are not elected on June 7th, we will withdraw our offer, since it will take at least two more years, until the 2003 annual meeting, to effect a transaction not approved by the current Willamette board," Rogel said. 
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