SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(d)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
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SHOREWOOD PACKAGING CORPORATION
(Name of Subject Company)
SHOREWOOD PACKAGING CORPORATION
(Name of Person(s) Filing Statement)
Common Stock, Par Value $0.01 Per Share
(Title of Class of Securities)
825229107
(CUSIP Number of Class of Securities)
Andrew N. Shore, Esq.
Vice President, General Counsel and Secretary
Shorewood Packaging Corporation
277 Park Avenue
New York, New York 10172
Telephone: (212) 371-1500
(Name, Address and Telephone Number of Person Authorized to Receive
Notice and Communications on Behalf of the Person(s) Filing Statement).
With a Copy to:
Jeffrey W. Tindell, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036-6522
Telephone: (212) 735-3000
Facsimile: (212) 735-2000
[X] Check the box if the filing relates solely to preliminary
communications made before the commencement of a tender offer.*
*This Schedule 14D-9 relates to the proposed tender offer by International
Paper Company.
FOR IMMEDIATE RELEASE:
CONTACTS:
Sard Verbinnen & Co.
David Reno/Paul Caminiti/Brandy Bergman
(212) 687-8080
SHOREWOOD PACKAGING AGREES TO BE ACQUIRED BY
INTERNATIONAL PAPER FOR $21 PER SHARE
INTERNATIONAL PAPER WILL COMMENCE TENDER OFFER FOR ALL
OUTSTANDING SHOREWOOD SHARES
STRATEGIC COMBINATION PROVIDES INTERNATIONAL PAPER WITH
LEADING SPECIALTY PACKAGING BUSINESS
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NEW YORK, NY, FEBRUARY 17, 2000 - Shorewood Packaging Corporation
(NYSE:SWD) today announced that it has reached a definitive merger
agreement providing for International Paper Company (NYSE:IP) to acquire
Shorewood for $21 per share in cash. International Paper will also assume
Shorewood's approximately $275 million in outstanding debt, giving the
transaction a total value of approximately $875 million. The Boards of both
International Paper and Shorewood have unanimously approved the
transaction.
Pursuant to the definitive merger agreement, International Paper will
shortly commence a cash tender offer of $21 per share for all of
Shorewood's outstanding shares. Marc P. Shore, Shorewood's Chairman and
Chief Executive Officer, and the Shore family, who together control
approximately 17% of Shorewood stock, have agreed to tender their shares
into the International Paper offer.
The strategic acquisition of Shorewood will improve International
Paper's position in the value added, specialty packaging business.
Shorewood brings to International Paper state-of-the-art, printed packaging
capabilities in the music and home entertainment, tobacco, cosmetics and
toiletries, and hair coloring industries, among others. Shorewood will
benefit from becoming part of a stronger, more diversified and
international organization that is among the global leaders in the paper
and packaging industry.
Under the terms of the transaction, Shorewood will become the premium
retail packaging operation of IP with the existing IP operations combined
with Shorewood into a single business unit under the Shorewood name. Marc
Shore will become President of Shorewood under IP's ownership, and Howard
M. Liebman, currently Shorewood's President and Chief Financial Officer,
will become Executive Vice President of the Shorewood business. The
transaction is subject to antitrust approval and other customary
conditions, and is expected to close by the end of March 2000.
William Slowikowski, International Paper's Senior Vice President for
Consumer Packaging, stated, "Shorewood is a premier franchise with a
reputation for high quality, value added products and outstanding customer
service. The acquisition of Shorewood is a very significant step in
International Paper's efforts to deliver more value to our customers."
Marc Shore stated, "Our goals have always been very clear - to
enhance shareholder value, provide for employee continuity and continue our
focus on serving the interests of our customers. Consistent with those
goals, we believe that International Paper is the ideal partner for
Shorewood. International Paper has the industry breadth, expertise and
global presence to leverage Shorewood's existing businesses and take them
to the next level. We're confident that our customers and employees will
benefit from this strategic combination."
Shore continued, "We are especially pleased that we were able to
achieve an appropriate valuation for Shorewood shareholders - representing
a 22% premium to Chesapeake's (NYSE:CSK) inadequate offer and an all-time
high price for Shorewood shares. I'm extremely proud of the Shorewood
Board, which after looking at a number of alternatives to enhance value,
was able to arrive at a deal that is clearly in the best interests of
Shorewood shareholders, employees and customers."
Shore added, "We view this as a new chapter for Shorewood. We're
confident that the greatest period of growth and opportunity for our
business lies ahead, in the context of our new partnership with
International Paper. We look forward to quickly consummating this
transaction."
Separately, Shorewood also announced that, based on preliminary data,
it expects revenues for the Company's third quarter, ended January 31,
2000, to be approximately $134 million compared to the $141 million
reported for the comparable period last year. The Company also expects that
operating and net earnings will be lower than those reported in the
comparable period last year. The Company's actual financial results for the
quarter will be disclosed by mid-March.
International Paper (http://www.internationalpaper.com) is the
world's largest forest products company. Businesses include printing paper,
packaging, building materials, chemical products and distribution. As the
largest private landowner in the U.S., the company manages its forest under
the Sustainable Forestry Initiative (SFIsm) program, a system that ensures
the perpetual growing and harvesting of trees while protecting wildlife,
plants, soil, air and water quality. Headquartered in the United States at
Purchase, New York, IP has operations in nearly 50 countries, employs
nearly 100,000 people and exports its products to more than 130 nations.
Shorewood Packaging Corporation is a leading value-added provider of high
quality printing and paperboard packaging for the computer software,
cosmetics and toiletries, food, home video, music, tobacco and general
consumer markets in North America and China, with 16 plants in the United
States, Canada and China.
Certain statements included in this press release constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995 (the "Act"). While the safe harbors intended
to be created by the Act are not available to statements made in connection
with a tender offer, it has not been judicially determined whether such
safe harbor provisions apply to forward-looking statements made in
connection with a consent solicitation conducted in connection with a
tender offer. However, the consent solicitation by Chesapeake Corporation
is intended to facilitate its tender offer, and the statements made herein
may be deemed to have been made in connection with such tender offer.
Accordingly, such statements may not be covered by the safe harbor
provisions of the Act. Any forward-looking statements made herein are only
predictions, subject to risks and uncertainties that exist in the business
environment which could render actual outcomes and results materially
different from those expressed in such statements, including, but not
limited to, general economic and business conditions, competition,
political changes in international markets, raw material and other
operating costs; costs of capital equipment, changes in foreign currency
exchange rates, changes in business strategy or expansion plans, the
results of continuing environmental compliance testing and monitoring;
quality of management; availability, terms and development of capital,
fluctuating interest rates and other factors referenced in this release and
in Shorewood's annual report on Form 10-K and quarterly reports on Form
10-Q.
THIS PRESS RELEASE DOES NOT CONSTITUTE A SOLICITATION TO REVOKE CONSENTS IN
CONNECTION WITH THE CONSENT SOLICITATION OF CHESAPEAKE CORPORATION. ANY
SUCH SOLICITATION WILL BE MADE ONLY BY MEANS OF SEPARATE CONSENT
SOLICITATION MATERIALS COMPLYING THE REQUIREMENTS OF SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER.
CERTAIN INFORMATION CONCERNING PARTICIPANTS
Shorewood Packaging Corporation ("Shorewood") and certain other persons
named below may be deemed to be participants in the solicitation of
revocations of consents in response to the consent solicitation being
conducted by Chesapeake Corporation ("Chesapeake"). The participants in
this solicitation may include: (i) the directors of Shorewood (Marc P.
Shore (Chairman of the Board and Chief Executive Officer), Howard M.
Liebman (President and Chief Financial Officer), Leonard Verebay (Executive
Vice President), Andrew N. Shore (Vice President and General Counsel),
Kevin J. Bannon, Sharon R. Fairley, Virginia A. Kamsky, R. Timothy
O'Donnell and William P. Weidner; and (ii) William H. Hogan (Senior Vice
President, Finance and Corporate Controller). As of the date of this
communication, the number of shares of common stock, par value $0.01 per
share ("Common Stock"), beneficially owned by the Shorewood participants
(including shares subject to stock options exercisable within 60 days) is
as follows: Marc P. Shore (4,750,485), Howard M. Liebman (233,269), Leonard
J. Verebay (500,180), Andrew N. Shore (169,052), Kevin J. Bannon (33,000),
Virginia A. Kamsky (4,500), R. Timothy O'Donnell (326,118); William P.
Weidner (57,000); and William H. Hogan (30,500).
Shorewood has retained Bear, Stearns & Co. Inc. ("Bear Stearns") and
Jefferson Capital Group, Ltd. ("Jefferson Capital") to act as its
co-financial advisors in connection with the tender offer (the "Offer") by
Chesapeake and its wholly owned subsidiary, Sheffield, Inc., to purchase
shares of Common Stock for $17.25 per share net to the seller in cash, for
which Bear Stearns and Jefferson Capital may receive substantial fees, as
well as reimbursement of reasonable out-of-pocket expenses. In addition,
Shorewood has agreed to indemnify Bear Stearns, Jefferson Capital and
certain related persons against certain liabilities, including certain
liabilities under the federal securities laws, arising out of their
engagement. Neither Bear Stearns nor Jefferson Capital admit that they or
any of their partners, directors, officers, employees, affiliates or
controlling persons, if any, is a "participant" as defined in Schedule 14A
promulgated under the Securities Exchange Act of 1934, as amended, in the
solicitation of consent revocations, or that Schedule 14A requires the
disclosure of certain information concerning Bear Stearns and Jefferson
Capital, respectively.
In connection with Bear Stearns' role as co-financial advisor to Shorewood,
Bear Stearns and the following investment banking employees of Bear Stearns
may communicate in person, by telephone or otherwise with a limited number
of institutions, brokers or other persons who are stockholders of Shorewood
and may solicit consent revocations therefrom: Terence Cryan (Senior
Managing Director), Charles Edelman (Senior Managing Director), Mark A. Van
Lith (Managing Director) and Karen Duffy (Vice President). Bear Stearns
engages in a full range of investment banking, securities trading,
market-making and brokerage services for institutional and individual
clients. In the normal course of its business Bear Stearns may trade
securities of Shorewood for its own account and the accounts of its
customers, and accordingly, may at any time hold a long or short position
in such securities. Bear Stearns has informed Shorewood that, as of the
date hereof, Bear Stearns held, net long, no shares of Common Stock for its
own account.
Bear Stearns and certain of its affiliates may have voting and dispositive
power with respect to certain shares of Common Stock held in asset
management, brokerage and other accounts. Bear Stearns and such affiliates
disclaim beneficial ownership of such shares of Common Stock.
In connection with Jefferson Capital's role as co-financial advisor to
Shorewood, Jefferson Capital and the following investment banking employees
of Jefferson Capital may communicate in person, by telephone or otherwise
with a limited number of institutions, brokers or other persons who are
stockholders of Shorewood and may solicit consent revocations therefrom: R.
Timothy O'Donnell (President) and Louis W. Moelchert (Vice President). R.
Timothy O'Donnell is the beneficial owner of 276,118 shares of Common
Stock. Louis W. Moelchert is the beneficial owner of 1,500 shares of Common
Stock. Jefferson Capital has informed Shorewood that, as of the date
hereof, it held 22,231 shares of Common Stock in its investment account.
The special committee of independent directors (the "Special Committee") of
the Shorewood Board of Directors, formed to evaluate strategic alternatives
which could enhance stockholder value, has retained Greenhill & Co., LLC
("Greenhill") as its financial advisor. In connection with Greenhill's role
as financial advisor to the Special Committee, Greenhill and the following
investment banking employees of Greenhill may communicate in person, by
telephone or otherwise with a limited number of institutions, brokers or
other persons who are stockholders of Shorewood and may solicit consent
revocations therefrom: Robert F. Greenhill (Chairman), Scott L. Bok
(Managing Director), James M. Wildasin (Vice President) and Joseph A.
McMillan, Jr. (Associate). Greenhill has informed Shorewood that, as of the
date hereof, Greenhill held, net long, no shares of Common Stock for its
own account.
# # #
INVESTORS AND SECURITY HOLDERS ARE ADVISED TO READ THE SOLICITATION
/RECOMMENDATION STATEMENT REGARDING THE TENDER OFFER REFERENCED IN THE
FOREGOING INFORMATION, WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN
IMPORTANT INFORMATION. THE SOLICITATION/RECOMMENDATION STATEMENT WILL BE
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION BY SHOREWOOD PACKAGING
CORPORATION. INVESTORS AND SECURITY HOLDERS MAY OBTAIN A FREE COPY OF THE
SOLICITATION /RECOMMENDATION STATEMENT (WHEN AVAILABLE) AND OTHER DOCUMENTS
FILED BY SHOREWOOD PACKAGING CORPORATION WITH THE COMMISSION AT THE
COMMISSION'S WEB SITE AT www.sec.gov. THE SOLICITATION/RECOMMENDATION
STATEMENT AND SUCH OTHER DOCUMENTS MAY ALSO BE OBTAINED FOR FREE FROM
SHOREWOOD PACKAGING CORPORATION BY DIRECTING SUCH REQUEST TO: SHOREWOOD
PACKAGING CORPORATION, 277 PARK AVENUE, 30TH FLOOR, NEW YORK, NEW YORK
10172, ATTENTION: HOWARD M. LIEBMAN, TELEPHONE: (212) 371-1500, E-MAIL:
[email protected].
