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Graphic Packaging Buys Sierra Pacific Assets

Graphic Packaging Holding Co. said its international arm has agreed to buy substantially all of the assets of Sierra Pacific Packaging Inc.

MARIETTA, Ga. (AP) -- Graphic Packaging Holding Co. said Monday its international arm has agreed to buy substantially all of the assets of Sierra Pacific Packaging Inc., which makes folding cartons, beverage carriers and corrugated boxes.

Graphic Packaging International said the deal will give it a strategic location to serve customers on the West Coast.

Sierra Packaging, which has operations in Oroville, Calif., is a leader in producing beverage carriers made from 100 percent recycled materials, its CEO Allen Ennis said.

The deal is expected to occur during the second quarter of 2011.

Graphic Packaging Holding also said Monday it launched a 47 million share public offering and plans to use $53 million of the proceeds for the Sierra Pacific deal. The terms of the Sierra Pacific deal were not specifically disclosed, however.

The underwriters of the share offering have been given a 30-day option to purchase up to an additional 15 percent of the shares sold to cover any over-allotments.

Graphic Packaging also intends to use the net proceeds from the offering to repurchase 6.5 million shares of stock held by the Grover C. Coors Trust, or nearly 7.5 million shares if the underwriters exercise their options in full.

The company will use any remaining net proceeds to reduce its debt and for general corporate purposes.

Its shares slipped 5 cents to $5.38 in morning trading Monday.

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