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Georgia-Pacific Wants to Buy Buckeye

By Rich Smith - Apr 24, 2013 at 4:52PM

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Proposed acquisition has a $1.5 billion price tag -- and that could grow.

Privately held (by the Koch Bros.) paper and pulp company Georgia-Pacific has agreed to acquire Buckeye Technologies (BKI.DL) for the princely sum of $1.5 billion, Buckeye announced this morning.

The deal, structured as an all-cash transaction, would see G-P pay $37.50 per share to Buckeye shareholders, approximately a 25% premium to Tuesday's pre-announcement closing price. Logistically, G-P plans to invite shareholders to tender their shares to it at the proposed price. If at least 75% of shares outstanding are in fact tendered, then the acquisition will proceed.

For its part, Buckeye supports G-P's bid, with CEO John Crowe saying, "This transaction enables our stockholders to realize significant value."

Perhaps even more value than he knows. Already, Buckeye shares have run past Georgia-Pacific's proposed purchase price, and up to $37.75, in hopes a bidding war breaks out. Stay tuned and we'll let you know if that happens.

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