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MWV Announces Agreement with Plum Creek to Sell Its U.S. Forestlands and Form a New Partnership for Its South Carolina Real



  MWV Announces Agreement with Plum Creek to Sell Its U.S. Forestlands and
  Form a New Partnership for Its South Carolina Real Estate Assets

  * Plum Creek to acquire all of MWV’s U.S. forestlands
  * MWV and Plum Creek to form joint ventures for South Carolina development
    properties
  * Total consideration is $1.1 billion; Aggregate value of transaction is
    $1.5 billion
  * Most proceeds to be returned to shareholders

Business Wire

RICHMOND, Va. -- October 28, 2013

MeadWestvaco Corporation (NYSE: MWV), a global leader in packaging and
packaging solutions, today announced that it has reached a definitive
agreement with Plum Creek Timber Company, Inc. (NYSE: PCL) whereby Plum Creek
will acquire all of MWV’s U.S. forestlands and will invest in a newly formed
partnership comprised of MWV’s development properties in the Charleston, S.C.,
region. The total consideration of the transaction is approximately $1.1
billion, consisting of cash and an installment note. The aggregate value of
the transaction, including both parties’ investments in the partnership, is
approximately $1.5 billion. MWV intends to return approximately $665 million
of the proceeds from the transaction to its shareholders.

“This transaction delivers on all of our objectives — it enables us to
maximize the value of our land holdings in a tax-efficient manner, while
retaining the substantial upside potential of the attractive real estate
opportunities in the growing Charleston market. At the same time, we are
maintaining a secure source of fiber for our mills,” said John A. Luke, Jr.,
chairman and CEO, MWV. “Plum Creek is an outstanding company that shares our
commitment to both sustainably managing forests and forging lasting community
partnerships in real estate development. As a strong company with deep
expertise in land management and development, Plum Creek is the ideal partner
for MWV as we move forward with the high-return real estate entitlement and
community development opportunities we have in Charleston.”

U.S. Forestlands Acquisition

Under the terms of the agreement, Plum Creek will acquire all of MWV’s U.S.
forestlands and certain related assets, comprising approximately 501,000 acres
in Alabama, Georgia, South Carolina, Virginia and West Virginia, for $934
million, of which approximately $74 million will be in cash and $860 million
will be in the form of a 10-year installment note from Plum Creek that MWV
intends to securitize or otherwise finance after closing. Also included in the
transaction is the royalty and lease income currently being generated on these
lands from coal and wind.

MWV will retain full ownership of its oil and natural gas rights on
approximately 191,000 acres of land in West Virginia that are located over the
Marcellus Shale fairway.

As part of the transaction, MWV and Plum Creek will execute 25-year fiber
supply agreements covering forestlands in Virginia and West Virginia to ensure
an uninterrupted supply of high-quality fiber to MWV’s Covington, Va.,
paperboard mill. The fiber will be sold at market price, and the forestlands
will continue to be managed and third-party certified under the requirements
of the Sustainable Forestry Initiative (SFI®) standard.

South Carolina Development Properties Joint Ventures

In addition to the U.S. forestland acquisition, Plum Creek will invest in a
newly formed partnership comprised of MWV’s approximately 109,000 acres of
diversified development lands in the Charleston, S.C., region. Plum Creek will
acquire, for approximately $152 million in cash, an ownership interest in the
partnership, placing an implied value of the partnership at approximately $530
million.

The partnership will consist of two joint ventures. The first joint venture
(Joint Venture 1) will contain active development projects. Plum Creek will
contribute approximately $12.5 million in cash into this joint venture. MWV
will hold a 95 percent interest in the venture, and Plum Creek will hold the
remaining five percent interest. The other joint venture (Joint Venture 2)
will contain long-term development projects. Plum Creek will contribute
approximately $140 million in cash into this joint venture, and MWV and Plum
Creek will each hold a 50 percent interest in the venture.

MWV’s Community Development & Land Management (CDLM) business will lead the
joint ventures’ activities across all development projects, and will be the
managing partner. Kenneth T. Seeger, president of CDLM, will continue in his
current leadership role of this business. MWV will consolidate and report the
new partnership through the current CDLM segment.

“Our continued partnership and excellent working relationship with the
Charleston community will remain top priorities as we execute on our land
development strategy,” said Kenneth T. Seeger, president of CDLM. “We are
pleased by Plum Creek’s show of confidence in both our team and development
plans, and we look forward to working with them to further the significant
opportunities we have in Charleston.”

Timing

The transaction has been approved by the boards of directors of both companies
and is anticipated to close by the end of the year, subject to customary
closing conditions. The transaction does not require a shareholder vote for
either MWV or Plum Creek.

Post-Closing MWV Forestland Ownership

Upon closing, MWV will no longer own forestland assets in the United States.
MWV will continue to own and manage approximately 135,000 acres of forestland
in the state of Santa Catarina, Brazil. MWV intends to retain these
forestlands to serve its recently expanded virgin kraftliner operation in
Brazil.

Use of Proceeds

MWV intends to return most of the proceeds obtained in the transaction to its
shareholders. The company estimates that net proceeds will be $950 million,
after monetization of the installment note and payment of taxes and fees.
Approximately $210 million will be used to repay an outstanding term loan in
order to maintain MWV’s investment grade rating. In addition, approximately
$75 million will be retained in the joint ventures to fund development
activities. Upon closing, or shortly thereafter, MWV will determine the
optimal form of returning the remaining proceeds to shareholders.

The company expects to maintain its current quarterly dividend rate of $0.25
per share.

Advisors

BofA Merrill Lynch and the Goldman Sachs Group, Inc. served as financial
advisors to MWV. Wachtell, Lipton, Rosen & Katz, and Nelson Mullins Riley &
Scarborough LLP, served as legal advisors to MWV. Greenhill & Co. LLC provided
an independent fairness opinion to the company’s board of directors.

Conference Call

MWV will discuss the transaction in conjunction with its third quarter results
conference call, which is scheduled for tomorrow, Oct. 29, 2013, at 10 a.m.
EDT. Investors may participate in the call by dialing 800-230-1093 (toll-free
domestic) or 612-332-0226 (international); passcode: MeadWestvaco. Please call
to register at least 10 minutes before the conference call begins. The live
conference call and presentation slides may be accessed via MWV’s website at
www.mwv.com. After connecting to the home page, go to the “Investors” page,
and look for the link to the webcast. A replay of the call will be available
for one month via the telephone, starting at noon EDT on Oct. 29, 2013, and
can be accessed at 800-475-6701 (toll-free domestic) or 320-365-3844
(international); access code: 304380.

About MWV

MeadWestvaco Corporation (NYSE:MWV) is a global packaging company providing
innovative solutions to the world’s most admired brands in the healthcare,
beauty and personal care, food, beverage, home and garden, tobacco, and
agricultural industries. The company also produces specialty chemicals for the
automotive, energy, and infrastructure industries and maximizes the value of
its land holdings through forestry operations, property development and land
sales. MWV’s network of 125 facilities and 16,000 employees spans North
America, South America, Europe and Asia. The company has been recognized for
financial performance and environmental stewardship with a place on the Dow
Jones Sustainability World Index every year since 2004. Learn more at
www.mwv.com.

Forward-looking Statements

Certain statements in this document and elsewhere by management of the company
that are neither reported financial results nor other historical information
are “forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995. Such information includes, without limitation,
the business outlook, assessment of market conditions, anticipated financial
and operating results, strategies, future plans, contingencies and
contemplated transactions of the company. Such forward-looking statements are
not guarantees of future performance and are subject to known and unknown
risks, uncertainties and other factors which may cause or contribute to actual
results of company operations, or the performance or achievements of each
company, or industry results, to differ materially from those expressed or
implied by the forward-looking statements. In addition to any such risks,
uncertainties and other factors discussed elsewhere herein, risks,
uncertainties, and other factors that could cause or contribute to actual
results differing materially from those expressed or implied for the
forward-looking statements include, but are not limited to, events or
circumstances which affect the ability of MeadWestvaco to realize improvements
in operating earnings from the company’s ongoing cost reduction initiatives;
the ability of MeadWestvaco to close announced and pending transactions;
competitive pricing for the company’s products; impact from inflation on raw
materials, energy and other costs; fluctuations in demand and changes in
production capacities; relative growth or decline in the United States and
international economies; government policies and regulations, including, but
not limited to those affecting the environment, climate change, tax policies
and the tobacco industry; the company’s continued ability to reach agreement
with its unionized employees on collective bargaining agreements; the
company’s ability to execute its plans to divest or otherwise realize the
greater value associated with its land holdings; adverse results in current or
future litigation; currency movements; volatility and further deterioration of
the capital markets; and other risk factors discussed in the company’s Annual
Report on Form 10-K for the year ended December 31, 2012, and in other filings
made from time to time with the SEC. MeadWestvaco undertakes no obligation to
publicly update any forward-looking statement, whether as a result of new
information, future events or otherwise. Investors are advised, however, to
consult any further disclosures made on related subjects in the company’s
reports filed with the SEC.

Contact:

MeadWestvaco Corporation
Media Contact
Tucker McNeil, +1-804-444-6397
mediainquiries@mwv.com
or
Investor Relations
Jason Thompson, +1-804-444-2556
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