Global Processing

Koch acquiring Georgia-Pacific for $13.2 billion

November 14, 2005

Paper products giant Georgia-Pacific Corp., the maker of Brawny paper towels and Angel Soft tissue, has agreed to be acquired for more than $13 billion by Koch Industries Inc., a deal that would create the nation''s biggest private company according to the Associated Press. The $13.2 billion cash deal announced November 13 also calls for Koch to assume $7.8 billion in Georgia-Pacific debt and will result in the Atlanta-based company becoming a wholly owned subsidiary of Koch. The deal values GP at $48 per share, a 38.5 percent premium over its closing price of $34.65 Friday on the New York Stock Exchange. Koch, based in Wichita, Kan., is a commodities conglomerate that operates refineries and pipelines, trades commodities and manufactures pulp, paper and fibers. Besides Brawny, Georgia-Pacific''s brands include Dixie paper cups and Quilted Northern bath tissue. The company also makes building products such as plywood, lumber and gypsum wallboard. The proposed acquisition would be the largest in Koch''s history, coming about 18 months after it acquired Invista BV, a nylon fibers business that makes Lycra and Stainmaster, from DuPont Co. Koch acquired two pulp mills from Georgia-Pacific in May 2004.