posted on September 09, 2011 22:09
Corrugated packaging maker Temple-Inland Inc. has agreed to be bought byInternational Paper Co. for $4.3 billion, or $32 per share plus $600 in assumed debt.
The sale comes two weeks after Austin-based Temple-Inland (NYSE: TIN) was sued for its role in the 2009 failure of Austin-based Guaranty Bank. Onlookers worried that would kill International Paper Co.’s interest.
In June, Temple-Inland had rejected an offer of $30.60 per share from Tennessee-based International Paper (NYSE: IP).
But Temple-Inland’s negotiating position changed drastically last month when its Bogalusa, La., paper mill was shut down following an operational issue at its waste treatment facility following the deaths of hundreds of thousands of fish.
Then two weeks ago, a court-appointed trustee sued Temple-Inland with allegations of “fraudulently looting” Guaranty Bank of more than $1 billion in assets and contributing to its demise. Temple-Inland owned the bank’s operating company, Guaranty Financial Group Inc.
In August 2009, Guaranty Financial filed a formal petition in U.S. Bankruptcy Court — on the heels of the decision by the Federal Deposit Insurance Corp. — to shut down the company and Guaranty Bank branches. The bankruptcy filing indicated that Guaranty had liabilities of $323 million, against assets of only $24.3 million following an FDIC sale.
Temple-Inland employs about 450 workers in Austin and 10,000 worldwide. The company has roots dating back to 1893 and the founding of the Southern Pine Lumber Co. in Diboll.
In July, it reported a $19 million profit on $1.02 billion revenue during the second quarter versus a $20 million profit on $976 million revenue during the same period last year.
9/6/11, Christopher Calnan, Austin Business Journal