Document text
--> --> Willamette offers to talk sale - but for more money By William McCall AP Business Writer PORTLAND - A day after Willamette Industries Inc. announced profits were down slightly but ahead of analyst predictions, the largest forest products company in Oregon sent a letter to rival Weyerhaeuser Co. offering to sit down and talk about the Weyerhaeuser hostile takeover bid - if the purchase price was increased. Weyerhaeuser quickly replied with a much shorter letter of its own, saying it considered the offer "simply another way for you to just say no." The two Pacific Northwest timber giants have been locked in a takeover battle since last November, when Weyerhaeuser Chairman Steve Rogel launched the bid. Rogel, the former chairman of Willamette, began efforts to buy his old company shortly after moving to Weyerhaeuser late in 1997. The Willamette board of directors has stubbornly resisted, rejecting offer after offer, forcing a showdown last June at the annual Willamette shareholder meeting in Portland, which ended with the election of three Weyerhaeuser nominees to the nine-member Willamette board - not enough to take over, but a significant tactical defeat for Willamette. The downturn in the economy had led to speculation that Weyerhaeuser might abandon the takeover bid, but that ended last month when Richard M. "Mike" Clark, son of Willamette co-founder Maurie Clark, sent a letter to both companies asking that they negotiate the sale to Weyerhaeuser. It marked the first major crack in an otherwise solid bloc of support among longtime Willamette shareholders. On Wednesday, Willamette reported it earned $65.8 million, or 60 cents a share, for the quarter ending Sept. 30 - down 21 percent from $83.4 million, or 76 cents a share, for the same period in 2000. But the earnings were much better than predicted - the Portland-based company was expected to earn 52 cents a share, the average estimate by analysts polled by Thomson Financial/First Call. The better-than-expected performance is likely to reinforce the Weyerhaeuser view that Willamette is a solid company and a good buy, analysts said. "Was it a nice surprise? Yes. Was it a shock? No," said Mark Connelly, an analyst with Credit Suisse First Boston in New York, who added that he had expected even less - 45 cents a share for Willamette. In the letter sent Thursday to Weyerhaeuser, based in Federal Way, Wash., Willamette Chairman William Swindells and CEO Duane McDougall said it was time "to put an end to the unproductive and costly stalemate for both our companies and shareholders." Swindells and McDougall said that, despite the economic downturn, Willamette had maintained its value, justifying a buyout offer "in the high $50s" per share. The most recent Weyerhaeuser offer was $50 per share. Rogel, in his reply, said that $50 was a fair price, and he saw no reason to open negotiations unless Willamette came "to a more realistic view as to a fair value." Willamette had given Weyerhaeuser until Oct. 16 to reply, and there was no immediate word from Willamette about the quick response from Rogel. Email your... Technical questions & comments to: WebMaster Daily Tidings editorial comments & questions to: Editor Visit our other Oregon Newspapers... | Albany Democrat-Herald | Ashland Daily Tidings | Corvallis Gazette-Times | | Lebanon Express | Newport News-Times | Springfield News | Cottage Grove Sentinel | Ashland Daily Tidings 1661 Siskiyou Blvd. Ashland, OR 97520 Telephone 541-482-3456 © Copyright 2001 Lee Northwest Publishing