P. M. Briefing : Great Northern Takeover Target

Georgia-Pacific Corp., one of the largest lumber companies, today launched a $3.2-billion bid for papermaker Great Northern Nekoosa Corp. in a merger that would create the world’s largest forest products company.

Great Northern stock surged $18.75 to $61.50 in heavy early trading on the New York Stock Exchange, hurtling past the $58 that George-Pacific offered for each share.

But Atlanta-based Georgia-Pacific’s stock dropped $2.25 to $51.125 as traders bet that it could be headed for a costly acquisition fight.

Great Northern, headquartered in Norwalk, Conn., said the bid was uninvited, but Georgia-Pacific appeared determined to push forward with the offer and perhaps sweeten it.

The combined forest products company would top other leading forest products companies such as International Paper Co. and Weyerhaeuser Co. in sales, with a combined total of nearly $14 billion.