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Georgia-Pacific Board Authorizes Planning for Strategic Separation

Press release from the issuing company

ATLANTA, March 29 -- Georgia-Pacific’s board of directors, at its regular meeting today, authorized the corporation's management team to finalize planning for the strategic separation of Georgia-Pacific's consumer products and packaging business from its building products and distribution businesses. The company's board intends to consider for approval the finalized separation plan at its next regular meeting in May. "For the past five years -- from the creation of The Timber Company through the acquisition of Fort James Corp. and in subsequent transactions -- Georgia-Pacific has been taking deliberate, strategic steps to unlock the full value of the company. We continue to believe that through sharpened focus, our portfolio of assets -- properly configured -- will deliver greater value for our shareholders going forward,'' said A.D. "Pete'' Correll, Georgia-Pacific chairman and chief executive officer. "The company's board and our management team remain committed to leveraging the assets, market positions and operating strengths that are characteristic of our individual businesses,'' Correll said. "Therefore, we will continue to actively pursue plans for the larger opportunity that strategic separation will present.'' The board also named Lee M. Thomas as president of the company's building products and distribution businesses, effective immediately. "Lee Thomas has excelled in every challenge presented to him at Georgia- Pacific,'' Correll said. "By putting Lee at the helm of the building products and distribution businesses, we have tasked an exceptional leader with unifying these businesses' strategic direction and future, just as he has done throughout his nine-year tenure with our company.'' Thomas, 57, has served as executive vice president - consumer products since 2000, concurrent with the announcement of Georgia-Pacific's acquisition of Fort James. At that time, he assumed responsibility for preparing and executing plans for integrating Fort James into Georgia-Pacific and achieving the operating synergies expected from the combination. Under Thomas' leadership, the consumer products segment has reached annualized operating synergies of more than $316 million since the acquisition. The segment has successfully completed a rationalization of its product brands, improved manufacturing efficiencies that have enhanced customer service and lowered costs, and launched a variety of new and improved consumer products. In his new role, Thomas will continue to report to Correll and have executive management responsibility for Georgia-Pacific's $7 billion building products manufacturing and distribution business, which is the largest in North America, as well as its $6 billion Unisource Worldwide business, which distributes packaging systems, printing and imaging papers and maintenance supplies. Reporting to Thomas will be Ronald L. Paul, executive vice president - wood products and distribution; John F. Rasor, executive vice president - wood procurement, gypsum and industrial wood products; Charles C. Tufano, president - Unisource; and Mario Concha, president - chemical. The management team for Georgia-Pacific's $12 billion consumer products and packaging business group remains in place. It includes Michael C. Burandt, president - North American consumer products, who adds manufacturing to his existing responsibilities for marketing and sales for North American operations; John F. Lundgren, president - European consumer products; and George W. Wurtz, president - paper and bleached board. These leaders will join David J. Paterson, executive vice president - pulp and paperboard, in reporting to Correll. "It is clear to us that there are significant benefits in keeping the consumer products and packaging businesses focused on executing strategies to enhance those businesses, and for our building products and distribution businesses to develop and execute separate, equally focused strategies,'' Correll added. "Both of these groups have strong, proven management teams in place that already have delivered significantly on Georgia-Pacific's transformation and will continue to seize on additional value inherent in their distinct businesses.'' Thomas joined Georgia-Pacific in 1993 as senior vice president - environmental and government affairs. He became senior vice president - paper in 1995, and was later promoted to executive vice president - paper and chemicals in 1997, with responsibility for the company's tissue, communication papers and chemicals businesses and, subsequently, the Unisource business. Prior to joining Georgia-Pacific, Thomas was chairman and chief executive officer of the Law Companies Environmental Group Inc.