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Aug. 22 - Georgia Pacific’s Acquisition of Buckeye Technologies Expected to Close Friday

By Lou Phelps, SBJ Staff

August 22, 2013 – Georgia Pacific’s acquisition of Memphis, TN-based Buckeye Technologies Inc. moved forward today when the U.S. Federal Trade Commission and the Antitrust Division of the U.S. Department of Justice granted termination of the waiting period required under the Hart-Scott-Rodino Antitrust Improvement Act of 1976, for the previously announced proposed acquisition by merger of Buckeye by GP Cellulose Group LLC, an indirect wholly-owned subsidiary of Georgia-Pacific LLC.

Buckeye Technologies Inc. (NYSE:BKI) ("Buckeye") is a publicly traded company being acquired by G-P, which is still privately held.

In the merger, GP Cellulose Group LLC would acquire all of the outstanding shares of common stock of Buckeye for $37.50 per share net to the seller in cash without interest and subject to any withholding of taxes required by applicable law. The Merger is expected to close tomorrow, August 23.  

Buckeye currently operates manufacturing facilities in the United States and Germany. Its products are sold worldwide to makers of consumer and industrial goods. The company’s current website is www.bkitech.com.

G-P has not announced any impact on current Georgia operations in Savannah or Brunswick as a result of the Buckeye acquisition.

On August 12, Buckeye announced net sales for the year at $812 million, down $82 million or 9% compared to net sales from continuing operations in fiscal 2012. Specialty Fibers external sales were down $72 million or 11% due to a small drop in shipment volume, lower fluff pulp and specialty cotton fibers pricing, and unfavorable sales mix due to weak market conditions in Europe. Nonwovens sales were down $10 million entirely due to the sale of the Merfin Systems converting business in mid-fiscal year 2012.

Adjusted net income for the 2013 fiscal year was $92 million or $2.32 per share, compared to a record $111 million or $2.76 per share in fiscal 2012, and the previous record net income of $91 million or $2.23 per share in fiscal 2011.

The two biggest drivers of the reduction in adjusted net income between fiscal years 2012 and 2013 were lower fluff pulp prices and unfavorable sales mix in the specialty fibers segment, where operating income was down $34 million year over year, according to the company.

Operating income for the nonwoven materials segment was up $9 million in fiscal year 2013 compared to fiscal year 2012 due to a large reduction in fixed manufacturing costs resulting from the closure of the company’s Delta, B.C., Canada airlaid facility in December 2012.

Fourth quarter net sales, ending June 30, 2013, were $216 million, down $9 million or 4% versus net sales of $225 million in the fourth quarter of fiscal 2012. While shipment volume was up 9%, driven by increased shipments from the company’s Foley wood fibers facility.

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