Willamette Industries, Inc., based in Portland, Oregon, and one of the primary forestry and forest products manufacturers in the North Louisiana Piney Woods, early last month found itself the target of what has developed into a hostile takeover bid by rival Weyerhaeuser Company, based in Federal Way, Washington.

Weyerhaeuser is headed by former Willamette CEO Steve Rogel, who left the Oregon company in 1997, and according to recently published reports has been trying unsuccessfully to acquire his old company for Weyerhaeuser since then.

On November 9, Weyerhaeuser made public an offer which had been communicated to the Willamette board of directors at $48 per share, or $5.4 billion. At that time, Willamette's board confirmed that it received the offer, and said that it "is committed to acting in the best interests of Willamette's shareholders and other constituencies." Willamette told Weyerhaeuser that it was "continuing to review the proposal, and will respond in due course. It is unfortunate that Weyerhaeuser chose to make its proposal public at this time."

Subsequently Willamette's board rejected the offer, after which Weyerhaeuser CEO Rogel publicly expressed surprise. In statements made to national news services, Rogel called Willamette an "ideal partner," and said the combined companies would rank No. 1 or No. 2 in the lumber, fine papers, and wood products markets.

Rogel was quoted as saying "This is a hand-and-glove fit. The proposed combination will result in a more balanced business mix that either company has on its own, leading to increased strength throughout the business cycle."

Willamette's board apparently feels the "glove didn't fit." After they rejected the first proposal, Weyerhaeuser made an unsolicited offer to shareholders, and set January 4 as a deadline for shareholders acceptance.

Willamette spokeswoman Cathy Dunn, director of corporate communications, told news services that the company will urge shareholders to decline the offer, and said she doubted they would do otherwise.

She was quoted on November 29 as saying, "Last week, the board looked at the $48 a share proposal and said it was not in the best interest of shareholders and declined. I don't know how this offer differs such that it would make them change their minds.

Investment company analysts appear to believe that the Willamette board may be holding out for a better price, and that Weyerhaeuser may decide to up the offer.

Willamette and Weyerhaeuser are both long-established West Coast companies who have been rivals for 100 years. Willamette was founded as the Willamette Valley Lumber Company in Dallas, Oregon in 1906, and is now one of the largest companies based in Oregon. Weyerhaeuser was founded in 1900 by Frederick Weyerhaeuser, a German immigrant.

Willamette's Southern Regional headquarters is in Ruston, Louisiana, from where it manages forestry and manufacturing operations in Louisiana and Arkansas. Willamette operates a major sawmill and plywood mill at Dodson, home of The Piney Woods Journal.

In other recent action, Willamette Industries' Board of Directors last month approved construction of a corrugated box plant in Oklahoma City; relocation and modernization of the Kingsport, Tennessee, cut sheet plant; and authorization to pursue a pulp mill modernization at the Albany, Oregon, paper mill. Kevin Igli was named vice president of environmental affairs.

The board approved a dividend of $.21 per share to be paid on December 14, 2000 to shareholders of record on November 27, 2000.

The Board authorized construction of a small corrugated plant in Oklahoma City. This plant will serve Willamette's existing customers in the area, as well as allow the company to take advantage of additional market opportunities.

The Kingsport sheeter plant, which makes cut size office papers, will move from the mill to a nearby site. A building will be constructed to house a new 10-pocket sheeter.

The pulp mill modernization at Albany would not increase the mill's capacity but will prepare the mill to meet the U.S. Environmental Protection Agency's Cluster Rules for pulp and paper mills and replace obsolete equipment.

Kevin Igli, who was hired as director of environmental affairs in June, was elected corporate vice president to oversee the environmental affairs of Willamette's manufacturing facilities, effective December 1.