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Weyerhaeuser to take over Plum Creek in $8.44bn deal

Published: 08:18 09 Nov 2015 EST

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The new company will keep the Weyerhaeuser name.

Plum Creek Timber Co (NYSE:PCL) jumped in morning trading on Monday after the private timberland owner agreed to be acquired by Weyerhaeuser (NYSE:WY), a real estate investment trust.

Shares of Plum Creek rose as much as 16% as of 8:07 a.m. in New York. The stock had lost 6% this year to close at $40.26 on Friday.

The transaction unveiled on Sunday would create a $23bn timber, land and forest products company, the largest in the United States, the companies said in a statement.

The new company will keep the Weyerhaeuser name. It will manage more than 13mlnn acres of timberland that will allow it to drive economies of scale and capitalize on the U.S. housing recovery.

Plum Creek shareholders will obtain 1.6 shares of Weyerhaeuser stock for each Plum Creek share held, with Weyerhaeuser holders owning about 65% of the combined company’s common stock.

Weyerhaeuser said it intends to execute a $2.5bn share buyback program shortly after closing the deal.

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