DISCONTINUED OPERATIONS

6 Months Ended

Jun. 30, 2011

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

Our discontinued operations for the quarter and year-to-date periods ended June 30, 2011, and June 30, 2010, include the operations of our hardwoods and Westwood Shipping Lines operations. The following table summarizes the components of net sales and net earnings from discontinued operations.

	QUARTER ENDED						YEAR-TO-DATE ENDED
DOLLAR AMOUNTS IN MILLIONS	JUNE 30, 2011			JUNE 30, 2010			JUNE 30, 2011			JUNE 30, 2010
Net sales:
Hardwoods	$	97		$	103		$	195		$	193
Westwood Shipping Lines	66			61			124			107
Total net sales from discontinued operations	$	163		$	164		$	319		$	300
Income (loss) from operations:
Hardwoods	$	(8	)	$	8		$	(8	)	$	11
Westwood Shipping Lines	2			1			4			(3		)
Other discontinued operations	(13		)	—			(13		)	—
Total income (loss) from discontinued operations	(19		)	9			(17		)	8
Income taxes	6			(3		)	5			(3		)
Net earnings (loss) from discontinued operations	$	(13	)	$	6		$	(12	)	$	5

Results of discontinued operations exclude certain general corporate overhead costs that have been allocated to and are included in contribution to earnings for the operating segments.

Other discontinued operations relate to current period charges for liabilities of businesses we have sold or divested in prior years and are included in the Corporate and Other segment. During second quarter 2011 we increased our reserve for estimated future environmental remediation costs and recognized an $11 million charge associated with discontinued operations. See Note 12: Legal Proceedings, Commitments and Contingencies for more information.

Our Consolidated Balance Sheet includes the following assets and liabilities of our hardwoods and Westwood Shipping Lines operations as of June 30, 2011 and December 31, 2010.

	JUNE 30, 2011		DECEMBER 31, 2010
ASSETS
Receivables, less allowances	$	42	$	36
Inventories	63		63
Prepaid expenses	8		7
Total current assets	113		106
Property and equipment, net	40		43
Other assets	16		15
Total assets	$	169	$	164
Liabilities
Accounts payable	$	8	$	8
Accrued liabilities	25		24
Total current liabilities	$	33	$	32

ANNOUNCED SALE OF HARDWOODS

During June 2011, we entered into a purchase and sale agreement to sell the assets of our hardwoods operations to American Industrial Partners and expect to receive consideration of $108 million, of which $25 million is a note receivable. The purchase price is subject to adjustments for working capital levels. We reduced our hardwoods assets to their fair value less selling costs which resulted in the recognition of a $9 million impairment in second quarter 2011. An additional $10 million pension curtailment charge was recognized subsequent to quarter end when the transaction closed on August 1, 2011.

The following operating assets are included as part of the transaction:

• seven primary hardwood mills with a total capacity of 300 million board feet,

• four concentration yards,

• three remanufacturing plants,

• one log merchandising yard and

• sales offices in the U.S., Canada, Japan, China and Hong Kong.

ANNOUNCED SALE OF WESTWOOD SHIPPING LINES

During June 2011, we entered into a purchase and sale agreement to sell all outstanding shares of Westwood Shipping Lines to J-WesCo of Japan for $53 million in cash, subject to adjustments for working capital levels at closing. As of June 30, 2011, the net carrying value of these assets was approximately $10 million. The transaction is subject to regulatory approval and is expected to close in the third quarter.