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Tenneco Postpones Sale of Its PCA Stock

25 October 1999

Tenneco Postpones Sale of Its PCA Stock Due to Weak Market Conditions; Tenneco On Track to Complete Spin

    GREENWICH, Conn.--Oct. 25, 1999--Tenneco Inc. today announced that it is postponing its sale, through a registered offering, of its remaining interest in Packaging Corporation of America (PCA). Tenneco also reiterated its plan to complete the spin-off of Tenneco Packaging and the separation of the automotive company on Nov. 4.
    Rapidly deteriorating equity market conditions, particularly in the paper and forest products sector, since mid-September when Tenneco announced its intent to sell the stock were responsible for the postponement.
    "Tenneco remains on track for the planned separation of Tenneco Packaging and Tenneco Automotive," said Tenneco Chairman and Chief Executive Officer Dana Mead. "Funds that would otherwise have been available from the IPO will be provided through bank facilities available to the packaging company. All the steps necessary for the tax-free spin-off of Tenneco Packaging to shareowners are proceeding as planned."
    Tenneco Packaging will retain Tenneco's interest in PCA after the spin, and intends to monetize the investment in PCA as general stock market conditions improve.

    As the planned spin-off and separation of the two companies approaches, Tenneco expects several key events to occur. Trading in Tenneco and the new companies is expected to begin on a "when issued" basis on Oct. 27. Completion of the tender offers and exchange offers in order to realign Tenneco's debt is expected to occur Nov. 3. The tax-free spin-off of Tenneco Packaging to shareowners of record Oct. 29 is expected to occur after close of business Thursday, Nov. 4, and the two separate businesses are expected to begin regular trading as stand-alone companies Friday, Nov. 5.
    Tenneco is a $6 billion manufacturing company headquartered in Greenwich, Conn., with 38,000 employees worldwide. Tenneco Automotive is one of the world's largest producers and marketers of ride control and exhaust systems and products, which are sold under the Monroe(R) and Walker(R) global brand names. Among its products are Sensa-Trac(R) shocks and struts, Rancho(R) shock absorbers, Walker(R) Quiet-Flow(TM) mufflers and DynoMax(TM) performance exhaust products, and Monroe(R) Clevite(TM) vibration control components. Tenneco Packaging is among the world's leading and most diversified packaging companies. Among its products are Hefty(R) trash bags, Hefty OneZip(R) and Baggies(R) food storage bags, E-Z Foil(R) single-use aluminum cookware and Hexacomb(R) paper honeycomb products.

    Several statements in this press release are forward looking and are identified by the use of forward-looking words and phrases, such as "is postponing," "plan," "since," "remains," "planned," "will be," "intends," "expects," and "expected." These forward-looking statements are based on the current expectations of the Company (including its subsidiaries). Because forward looking statements involve risks and uncertainties, the Company's plans, actions and actual results could differ materially. Among the factors that could cause plans, actions and results to differ materially from current expectations are: (i) the general political, economic and competitive conditions in markets and countries where the Company and its subsidiaries operate, including currency fluctuations and other risks associated with operating in foreign countries; (ii) governmental actions, including the ability to receive regulatory approvals and the timing of such approvals; (iii) change in capital availability or costs; (iv) results of analysis regarding plans and strategic alternatives; (v) changes in consumer demand and prices, including decreases in demand for the Company's products and the resulting negative impact on its revenues and margins from such products; (vi) the cost of compliance with changes in regulations, including environmental regulations; (vii) workforce factors such as strikes or labor interruptions; (viii) material substitutions and increases in the costs of raw materials; (ix) the ability of the Company and its subsidiaries to integrate operations of acquired businesses quickly and in a cost-effective manner; (x) new technologies; (xi) the ability of the Company, its subsidiaries and those with whom they conduct business to timely resolve the Year 2000 issue (relating to potential equipment and computer failures by or at the change of the century), unanticipated costs of, problems with, or delays in resolving the Year 2000 issue, and the costs and impacts if the Year 2000 issue is not timely resolved; (xii) changes by the Financing Accounting Standards Board or other accounting regulatory bodies of authoritative generally accepted accounting principles or policies; and (xiii) the timing and occurrence (or non-occurrence) of transactions and events which may be subject to circumstances beyond the control of the Company and its subsidiaries.