Georgia-Pacific going private; $13.2 billion acquisition by Koch

<p>Paper products giant Georgia-Pacific Corp., the maker of Brawny paper towels and Angel Soft tissue, is being acquired for more than $13 billion by Koch Industries Inc., the nation's second-biggest private company.</p><p>The $13.2 billion cash deal announced Sunday also includes the assumption of $7.8 billion in Georgia-Pacific debt and will result in Atlanta-based Georgia Pacific becoming a wholly owned subsidiary of Koch. The deal values GP at $48 per share, a 38.5 percent premium over GP's closing price of $34.65 Friday on the New York Stock Exchange.</p><p>Koch, based in Wichita, Kan., is a commodities conglomerate that operates refineries and pipelines, trades commodities and manufactures pulp and paper. With annual revenue of $60 billion, it is behind only food and farm products maker Cargill Inc. as the nation's largest private company. Koch, which employs more than 30,000 people, would become the largest in terms of revenue if it completes its deal for Georgia Pacific.</p><p>Besides Brawny, Georgia-Pacific's brands include Dixie paper cups and Quilted Northern bath tissue.</p><p>The deal is 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.</p><p>Koch acquired two pulp mills from Georgia Pacific in May 2004, a deal which provided executives of both companies an introduction and prompted ongoing discussions. Georgia Pacific CEO A.D. "Pete" Correll, who plans to retire, said talks on the current deal began in earnest last month.</p><p>"We look at the Koch results over the years and we're somewhat in awe of the results ... their management team has been able to achieve," Correll said in a telephone interview.</p><p>A Koch unit, Koch Forest Products, will launch a cash tender offer for Georgia-Pacific's outstanding shares by Friday.</p>