S&P: Temple-Inland view stable

Standard & Poor's said it revised the outlook on Temple-Inland Inc. to stable from negative and affirmed its BBB corporate credit rating.

"The outlook revision follows the announcement that Temple-Inland Inc. and International Paper Co. (BBB/stable) have entered into a definitive merger agreement under which International Paper will acquire all of the outstanding common stock of Temple-Inland for $32 per share in cash, plus the assumption of $600 million in Temple-Inland's year-end debt," S&P analyst Tobias Crabtree said in a statement.

"As a result of the proposed merger agreement, Temple-Inland is now unlikely in our view to face shareholder pressure to engage in some form of leveraging transaction, which could have lowered the ratings."

The rating incorporates expectations of adjusted debt-to-EBITDA ratio of 2.5x.

The outlook reflects the diminished likelihood of an adverse leveraging transaction given the company's entry into a merger agreement with International Paper, according to the agency.

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