SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
June 28, 1999
(Date of Report)
GEORGIA-PACIFIC CORPORATION
(Exact Name of Registrant as Specified in its Charter)
GEORGIA
(State of Incorporation)
1-3506
(Commission File Number)
93-0432081
(IRS Employer Identification Number)
133 PEACHTREE STREET, N.E., ATLANTA, GEORGIA 30303
(Address of Principal Executive Offices)
(404) 652-4000
(Registrant's Telephone Number, including area code)
Item 5. Other Events.
On June 25, 1999, the Corporation provided the following press
release.
GEORGIA-PACIFIC AND CHESAPEAKE ANNOUNCE PARTNERSHIP
FOR COMMERCIAL TISSUE OPERATIONS
ATLANTA, Ga. and RICHMOND, Va. - Georgia-Pacific Corp. (NYSE:GP)
and Chesapeake Corp. (NYSE:CSK) today announced that the two companies
have signed a letter of intent to combine their away-from-home tissue
businesses in a new partnership.
Georgia-Pacific Group, the pulp, paper and building products
business of Georgia-Pacific Corp., will contribute the assets of its
commercial tissue business to the partnership. Georgia-Pacific Group
will control and manage the partnership and is expected to own
approximately 90 percent of the equity of the partnership. Chesapeake
will contribute the assets of its Wisconsin Tissue business to the
partnership, for which it will receive a 10 percent interest in the
partnership and an initial cash distribution of approximately $730
million.
Commercial tissue products serve "away from home" markets such as
hospitals, restaurants, businesses, institutions and janitorial supply
firms. Atlanta-based Georgia-Pacific annually manufactures approximately
200,000 tons of tissue for such commercial markets. Wisconsin Tissue,
headquartered in Menasha, Wis., and currently operated as a wholly owned
subsidiary of Chesapeake Corp., exclusively serves the commercial tissue
market through its manufacturing facilities with a current capacity of
320,000 tons annually.
In announcing the partnership with Chesapeake, A.D. "Pete" Correll,
chairman and chief executive officer of Georgia-Pacific, said, "This
venture represents an outstanding strategic integration of the
commercial tissue businesses of two premier North American manufacturers
of tissue products. Through the partnership, Georgia-Pacific will expand
its ability to compete vigorously in this market without increasing
capacity. As part of our plan to leverage the synergies of both
businesses, we plan an extensive effort to integrate the two entities
and achieve maximum efficiencies. Our tissue business is a proven
winner that has added value for Georgia-Pacific shareholders. We
believe this step will ensure that Georgia-Pacific remains a top-tier
player in this market going forward."
Chesapeake President and Chief Executive Officer Thomas H. Johnson
said, "This is an outstanding opportunity to combine two strong and
complementary tissue businesses, with Chesapeake retaining a small, but
financially attractive interest. This transaction will enable us to
deliver immediate value to our shareholders, as we plan to use a major
portion of our cash distribution to repurchase 4 to 7 million of our
outstanding shares, with the balance used to significantly reduce our
debt and to continue the growth of our specialty packaging business
through strategic acquisitions. This transaction, coupled with the
pending sale of our forest products business, largely completes the
transformation of Chesapeake from a commodity producer to a marketing
focused supplier of specialty packaging and merchandising services."
Formation of the partnership is subject to completion and execution
of definitive agreements, completion of due diligence by both companies
and customary regulatory approvals. Completion is anticipated in the
fourth quarter of 1999.
Georgia-Pacific (www.gp.com) is the leading manufacturer and
distributor of building products in the United States and one of the
world's leading manufacturers and distributors of pulp, paper and
related chemicals for the forest products industry. It consists of two
distinct operating groups: Georgia-Pacific Group and The Timber Company
(NYSE: TGP), which manages 5 million acres of timberland in North
America. The company employs 45,000 people at more than 400 locations
in the United States and Canada.
Chesapeake Corp. (www.cskcorp.com) is a specialty packaging and
tissue company with over 55 locations in the United States, Europe,
Mexico and Canada.
Certain statements contained in this release, including, without
limitation, the existence and achievement of synergies of the
combined tissue businesses of Georgia-Pacific and Chesapeake, are
forward-looking statements (as such term is defined under the
Private Securities Litigation Reform Act of 1995) based on
current expectations. The accuracy of such statements is subject
to a number of risks, uncertainties and assumptions including,
but not limited to, the effect of general global and domestic
economic conditions on the demand for tissue products;
realization of cost savings and synergies in integrating the two
businesses; the effect of changes in the productive capacity of
manufacturers of competitive products, and other factors listed
in Georgia-Pacific Corp.'s Securities and Exchange Commission
filings, including but not limited to, its Annual Report on Form
10-K dated Dec. 31, 1998, on file and recorded March 18, 1999, as
well as Chesapeake Corp.'s Securities and Exchange Commission
filings, including but not limited to its Annual Report on Form
10-K dated Dec. 31, 1998, on file and recorded March 31, 1999 .
Contacts for Investor Relations:
Richard A. Good, Georgia-Pacific Corp., (404) 652-4720
Louis K. Matherne, Jr., Chesapeake Corp., (804) 697-1122
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
DATED: June 28, 1999
GEORGIA-PACIFIC CORPORATION
By /s/ Kenneth F. Khoury
Kenneth F. Khoury
Vice President, Deputy General
Counsel and Secretary