Weyerhaeuser raised the stakes in its battle with rival Willamette last week by extending for the seventh time its offer to buy the company’s shares for US$50 each.
Its offer, which was due to expire on October 18, will now run until December 5 and give Weyerhaeuser an additional seven weeks to improve on the 47% of Willamette shareholders that currently back its hostile takeover attempt.
The extension follows a shift in stance by the Willamette board who said earlier this month that they were willing to consider a Weyerhaeuser merger if the bid price was improved. In an open letter, Willamette’s chairman and chief executive Duane McDougall invited Weyerhaeuser to submit an offer valuing its shares ‘in the high US$50s’ as a prelude to opening negotiations.
If Weyerhaeuser does not comply, Willamette said it would pursue its strategic plan which could include making an acquisition or buying back shares.
In response to the letter, Weyerhaeuser chief executive Steven Rogel said he strongly discouraged Willamette from taking any action that could delay negotiations or impede shareholder value.
News of the latest moves in the hostile takeover battle followed Willamette Industries’ posting of third quarter results. These showed net income down 45% to US$65.8m on sales which had fallen to US$1.12bn from US$1.17bn.
