[LOGO OF PLUM CREEK] [LOGO OF GEORGIA-PACIFIC] [LOGO OF THE TIMBER COMPANY]
Contact:
Emilio Ruocco Greg Guest
Director, Investor Relations Director, External
Plum Creek Timber Co. Communications
(206) 467-3618 or 1-800-858-5347 Georgia-Pacific Corp.
(404) 652-4739
Robert J. Jirsa Rich Good
Director, Corporate and Director, Investor Relations
Environmental Affairs Georgia-Pacific Corp.
Plum Creek Timber Co. (404) 652-4720
206-467-3626 www.gp.com
www.plumcreek.com
PLUM CREEK TIMBER COMPANY AND THE TIMBER COMPANY
TO PROCEED WITH MERGER BASED ON OPINIONS FROM TAX COUNSEL
COMPANIES SET PRELIMINARY DATES FOR SHAREHOLDERS MEETINGS
SEATTLE AND ATLANTA - JUNE 12, 2001- Plum Creek Timber Company, Inc. (NYSE: PCL)
and Georgia-Pacific Corporation (NYSE: GP) have amended their merger agreement
and are proceeding with the previously announced merger of Plum Creek and The
Timber Company (NYSE: TGP).
The decision to move forward was made by the boards of directors of Plum Creek
and Georgia-Pacific following confirmation that they will receive opinions from
tax counsel that the spin-off of The Timber Company from Georgia-Pacific and the
subsequent merger with Plum Creek will be tax-free to both companies and their
shareholders. The outside legal opinions from independent tax counsel to each
company (Skadden, Arps, Slate, Meagher & Flom LLP, and McDermott, Will & Emery)
would replace a private letter ruling previously requested from the Internal
Revenue Service.
Plum Creek and The Timber Company plan to hold shareholder meetings on August
15, 2001, to approve the transaction. Closing is expected by the end of
September 2001.
The IRS has notified the companies that it decided not to issue the private
letter ruling because its standard for proving the business purpose for such a
ruling had not been met. This high burden of proof, which is more stringent than
applicable legal standards, pertains only to advance rulings. Based on
discussions with the IRS and the advice of legal counsel, the companies believe
the transaction will not be taxable. As an added
measure to reduce uncertainty concerning any possible tax risks, the companies
will obtain up to $500 million in tax liability insurance.
"Plum Creek and Georgia-Pacific have taken action enabling us to move into the
final phase of completing this important strategic transaction," said Plum Creek
President and CEO Rick R. Holley. "We are highly confident of our position,
based on our discussions with the IRS and on the opinions we will receive from
tax counsel, that the transaction will be tax-free to all parties. We have used
the past several months productively, and our initial work with our new partners
has reinforced our confidence that the new Plum Creek will have the scope of
resources, scale, structure and combined management capabilities to generate
increasing value for the shareholders of the combined company."
Following the merger, Plum Creek will be the second largest private timberland
owner in the United States, with more than 7.8 million acres of timberlands
located in 19 states.
A.D. "Pete" Correll, Chairman and Chief Executive Officer of Georgia-Pacific,
said, "This transaction creates significant value for both companies and their
shareholders. The opinions of our tax counsel are clear and unambiguous. We
believe the opinions of our tax counsel carry sufficient weight for us to move
forward with our plans for delivering the value from this transaction, divesting
our timberland ownership and continuing to reduce our overall corporate debt."
The financial terms of the agreement remain essentially the same. The Timber
Company shareholders will receive 1.37 shares of Plum Creek stock for each share
of The Timber Company stock. Based on Plum Creek's closing stock price of $28.11
on June 11, 2001, the overall transaction is valued at approximately $3.8
billion, including an estimated $730 million of The Timber Company debt that
Plum Creek will re-finance at closing.
Both companies will now seek the approval of the merger from their respective
shareholders. Proxy statements describing the transaction in detail will be
mailed promptly to shareholders of The Timber Company and Plum Creek.
Plum Creek, a real estate investment trust, is one of the largest land owners in
the nation, with timberlands in the Northwest, Southern, and Northeast regions
of the United States and nine wood product mills in the Northwest.
Headquartered at Atlanta, The Timber Company is a separate operating group of
Georgia-Pacific and its performance is reflected in one of the corporation's two
common stocks. The Timber Company manages 4.7 million acres of timberland in the
United States and sells timber and wood fiber to industrial wood users.
CONFERENCE CALL TODAY: Plum Creek President and CEO, Rick R. Holley, will host a
conference call for analysts and investors Tuesday, June 12, at 5:00 PM EDT. The
call-in number is: 800 606-8940
ATTACHMENTS: Pro Forma Fact Sheet
Map of Plum Creek Timber Company and The Timber Company
combined ownership
INVESTORS AND SECURITY HOLDERS ARE ADVISED TO READ, WHEN IT BECOMES AVAILABLE,
THE AMENDED JOINT PROXY STATEMENT/PROSPECTUS AND RELATED DOCUMENTS REGARDING THE
BUSINESS COMBINATION TRANSACTION REFERENCED IN THE FOREGOING INFORMATION TO BE
FILED BY PLUM CREEK AND GEORGIA-PACIFIC WITH THE SECURITIES AND EXCHANGE
COMMISSION (THE "SEC") BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. INVESTORS
AND SECURITY HOLDERS MAY OBTAIN A FREE COPY OF THE AMENDED JOINT PROXY
STATEMENT/PROSPECTUS (WHEN AVAILABLE) AND RELATED DOCUMENTS FILED BY PLUM CREEK
AND GEORGIA-PACIFIC AT THE SEC'S WEB SITE AT WWW.SEC.GOV. THE AMENDED JOINT
PROXY STATEMENT/PROSPECTUS AND RELATED DOCUMENTS MAY ALSO BE OBTAINED (WHEN
AVAILABLE) FROM PLUM CREEK BY DIRECTING SUCH REQUEST TO PLUM CREEK TIMBER
COMPANY, INC., ATTN: EMILIO RUOCCO, 999 THIRD AVENUE, SUITE 2300, SEATTLE, WA,
98104-4096 OR FROM THE TIMBER COMPANY BY DIRECTING SUCH REQUEST TO
GEORGIA-PACIFIC CORPORATION THE TIMBER COMPANY, ATTN: RICH GOOD, 133 PEACHTREE
STREET, N.E., ATLANTA, GA, 30303.
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements within the meaning of the
Private Litigation Reform Act of 1995. The accuracy of such statements is
subject to a number of risks, uncertainties and assumptions including, but not
limited to, the effect of general economic conditions on the demand for timber,
particularly the strength of the pulp and paper markets; the effect of any
material changes in the available supply of timber, including the levels of
harvests from public lands; and the effect of government, legislative and
environmental restrictions on the harvesting of private timberlands. These risks
are detailed from time to time in the filings of Plum Creek and Georgia-Pacific
with the Securities and Exchange Commission. Forward-looking statements speak
only as of the date made, and neither Plum Creek, Georgia-Pacific nor their
managements undertakes any obligation to update or revise any forward-looking
statements. It is likely that if one or more of the risks and uncertainties
materializes, the current expectations of Plum Creek, Georgia-Pacific and their
managements will not be realized.
PLUM CREEK TIMBER COMPANY AND THE TIMBER COMPANY
PRO FORMA FACT SHEET
SECOND LARGEST TIMBERLAND OWNER IN THE UNITED STATES
o 7.8 Million Acres
o 19 States
o 2,100 Employees
o Sales - $1.0 Billion (2000)
o Harvest- 5.3 MM Cunits (2000)
GEOGRAPHIC AND SPECIES DIVERSITY
o Southern pine forests 4.4 million acres
o Northern Rocky Mts. Douglas-fir/pine/larch/forests 1.5 million acres
o Mixed conifer/hardwood in Maine 0.9 million acres
o Northwest Douglas-fir/hemlock 0.5 million acres
o Mixed pine/hardwood forests in the Appalachian
and north central Region 0.5 million acres
OTHER BUSINESS ACTIVITIES
o Continuous evaluation and sale or exchange of selected properties that
have greater value as conservation, commercial, or recreation sites.
2000 revenue - $120 Million
o 8 Nurseries producing 147 million seedlings per year
o 9 Manufacturing Facilities in Montana and Idaho 2000 revenue - $375
Million
LEADERS IN ENVIRONMENTAL FORESTRY
o The 7.8 million acres will be managed under Plum Creek's
"Environmental Principles" and the Sustainable Forestry Initiative
(SFI) Program.
o 13 innovative conservation agreements are in place or in process,
covering over 2.3 million acres, and protecting 15 different
threatened and endangered species.
PRO FORMA FACTS
o Listed: NYSE, PSE: PCL
o Structure: Real Estate Investment Trust (REIT)
o Shares Outstanding: 180 million
o Market Cap: $5.0 Billion @ $28/share
o Headquarters: Seattle, WA