Paper products giant Georgia-Pacific Corp. (GP), the maker of Brawny paper towels and Angel Soft tissue, has agreed to be acquired for more than $13 billion by Koch Industries Inc., the nation's second-biggest private company.

The $13.2 billion cash deal announced Sunday also calls for Koch to assume $7.8 billion in Georgia-Pacific debt and will result in the Atlanta-based company becoming a wholly owned subsidiary of Koch. The deal values GP at $48 per share, a 38.5 percent premium over GP's closing price of $34.65 Friday on the New York Stock Exchange.

Koch, based in Wichita, Kan., is a commodities conglomerate that operates refineries and pipelines, trades commodities and manufactures pulp and paper. With annual revenue of $60 billion, it is behind only food and farm products maker Cargill Inc. as the nation's largest private company. Koch, which employs more than 30,000 people, would become the largest in terms of revenue if it completes its deal for Georgia Pacific.

Besides Brawny, Georgia-Pacific's brands include Dixie paper cups and Quilted Northern bath tissue.

The proposed acquisition would be the largest in Koch's history, coming about 18 months after it acquired Invista BV, a nylon fibers business that makes Lycra and Stainmaster, from DuPont Co.

Koch acquired two pulp mills from Georgia Pacific in May 2004, a deal which executives of both companies said Sunday provided an introduction and prompted ongoing discussions.

From the investment we made in Koch Cellulose, that really got us very interested in the entire forest products sector," Joe W. Moeller, Koch's president and chief operating officer, said in a telephone interview. "We see this really as a natural extension for our company and a great platform for growth."

Georgia Pacific CEO A.D. "Pete" Correll, who faced a mandatory retirement when he turns 65 next April, is expected to join Koch's board and help with the transition. Koch plans to name a new CEO and president of Georgia-Pacific later.

In a telephone interview, Correll said talks on the current deal began in earnest last month and that operating as a private company will allow Georgia-Pacific to invest in areas — particularly its packaging and building products businesses — where it has not previously because of concerns Wall Street would not approve of such expenditures.

Had it undertaken such investments, "we feel that the prospects are very high that our share price would go down," Correll said. Operating as a private concern also will allow Georgia-Pacific managers to "avoid the distraction of quarterly reports," better weather the industry's cyclical downturns and execute strategic decisions much faster, Correll said.

Correll joked that he also would not miss quarterly earnings conference calls with analysts, mandatory reporting requirements under the federal Sarbanes-Oxley corporate reform law "and 47 other" regulatory requirements.

A Koch unit, Koch Forest Products, will launch a cash tender offer for Georgia-Pacific's outstanding shares by Friday.