Temple-Inland to sell timberland for $2.38 billion

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NEW YORK, Aug 6 (Reuters) - Packaging and building products company Temple-Inland Inc. (TIN.N), which is under pressure from activist investor Carl Icahn, said on Monday that it would sell 1.55 million acres of timberland to Campbell Group Inc. for $2.38 billion and then issue a $1.1 billion special dividend.

The sale is part of a plan that Temple-Inland announced in February, which also includes spinning off two businesses, financial services and real estate. At that time, it had said it expected to return the majority of the proceeds from the sale to shareholders.

Icahn, which has a more than 8 percent stake in the company, at the beginning of the year began urging it to make changes, such as selling assets.

Temple-Inland said it was on track to complete the reorganization by the end of the year, after which it would own only packaging and building products.

The company said Campbell Group, a timberland investment management company in Portland, Oregon, would buy the land with installment notes, which will be pledged as collateral for a nonrecourse loan within 30 days of the sale.

Temple-Inland then expects to use some of its expected $1.8 billion in sale proceeds to pay a special dividend estimated at $1.1 billion, or $10.25 per share. It will use the remaining $700 million to reduce debt.

(Reporting by Caroline Humer)

((Editing by Lisa Von Ahn; Reuters Messaging: caroline.humer.reuters.com@reuters.net; caroline.humer@reuters.com; 1 646 223 6181)) Keywords: TEMPLE INLAND/

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