Georgia-Pacific and Chesapeake Corporation Reach an Agreement on Color-Box Joint VentureRICHMOND - Georgia-Pacific Corp. (NYSE:GP) and Chesapeake Corporation (NYSE:CSK) have reached an agreement for Georgia-Pacific to purchase from Chesapeake an additional 27 percent interest in Color-Box, LLC for $35 million. The transaction is expected to close in early July.Color-Box, LLC, a joint venture between G-P and Chesapeake, designs and manufactures litho-laminated corrugated graphic packaging. Color-Box includes packaging facilities at Madera (Coralure) and Visalia, Calif.; Richmond, Ind.; Dubuque and Monticello, Iowa; and Pelahatchie, Miss. G-P will own 81 percent of the joint venture after the transaction. As part of this agreement, in early 2002, Chesapeake has the option to sell to G-P, and G-P has the option to buy from Chesapeake, Chesapeake's remaining 19 percent interest in Color-Box, LLC, for $25 million. Georgia-Pacific's Executive Vice President Stephen E. Macadam said, "We believe that high-quality litho-laminated graphic packaging is a strong business for our containerboard and packaging division. With plenty of opportunity for growth, the Color-Box facilities are a good fit with our strategy to grow this segment of our business." Chesapeake Chairman, President and Chief Executive Officer Thomas H. Johnson said, "This transaction is a continuation of the series of planned divestitures that we announced earlier this year. In recent months, we have sold our corrugated containers business and announced the planned sale of our U.S. Display business. These steps have accelerated the repositioning of Chesapeake as a focused specialty packaging company and provide greater visibility to our inherent value." Headquartered at Atlanta, Georgia-Pacific is one of the world's leading manufacturers and distributors of tissue, pulp, paper, packaging, building products and related chemicals. With annual sales of approximately $27 billion, the company employs more than 85,000 people at 600 locations in North America and Europe. Chesapeake Corporation, headquartered in Richmond, Va., is a global leader in specialty packaging. Chesapeake is a leading European folding carton, leaflet and label supplier and a leader in plastics packaging for niche markets. Chesapeake has over 50 locations in North America, Europe, Africa and Asia. Chesapeake's website is www.cskcorp.com.
This news release, including comments by Thomas H. Johnson, contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions that may cause Chesapeake's actual results to differ materially from those expressed in the forward-looking statements including, but not limited to: the ability of the Company to complete divestitures in a timely manner and with adequate proceeds; competitive products and pricing; production costs, particularly for raw materials such as folding carton and plastics materials; fluctuations in demand; government policies and regulations affecting the environment; interest rates; fluctuations in foreign exchange rates; the ability of the Company to remain in compliance with its debt covenants; and other risks that are detailed from time to time in reports filed by the Company with the Securities and Exchange Commission.
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