Abitibi-Consolidated and Bowater combination approved by U.S. Department of Justice; companies announce date for Q3 earnings release

    MONTREAL, QC and GREENVILLE, SC, Oct. 23 /CNW Telbec/ -
Abitibi-Consolidated Inc. (NYSE:   ABY, TSX: A) and Bowater Incorporated (NYSE:  
BOW, TSX: BWX) today announced that they have reached an agreement with the
United States Department of Justice that will allow the completion of the
proposed combination of the two companies. Under the terms of the agreement,
which was signed and filed today in the U.S. Federal District Court in
Washington, D.C., the companies have agreed to divest one newsprint mill,
Abitibi-Consolidated's mill in Snowflake, Arizona. The Snowflake mill has an
annual capacity of approximately 375,000 tonnes. Scotia Capital Inc. will be
engaged as exclusive financial advisor for the sale of the Snowflake mill and
related assets, and all inquiries or expression of interest should be
forwarded directly to their attention.
    The proposed combination has now received all necessary regulatory
approvals, including those from the Canadian Competition Bureau, the Federal
Minister of Industry under the Investment Canada Act, the Québec Superior
Court and the U.S. Department of Justice, as well as the necessary approvals
from shareholders of both Abitibi-Consolidated and Bowater. The combination is
expected to close by the end of the month, following the completion of certain
administrative formalities.
    Announcing the agreement, Abitibi-Consolidated President and Chief
Executive Officer John W. Weaver commented, "We appreciate the hard work of
the U.S. Department of Justice staff and everyone else involved in completing
this process, and with this last approval, we look forward to closing the
proposed transaction quickly. We are eager to begin the work of building a new
company that creates long-term value for all of our stakeholders."
    "We believe the significant synergies we anticipate to generate from the
combination will create a stronger company, better positioned to address the
challenges of today's marketplace," added David J. Paterson, Chairman,
President and Chief Executive Officer of Bowater. "We expect that a more
efficient manufacturing platform will enable us to deliver more value through
better product quality and improved logistical flexibility."
    Abitibi-Consolidated and Bowater also announced that each company will
release their respective third quarter 2007 results before the markets open on
Tuesday, November 6, 2007. Further information regarding the companies'
earnings calls for analysts, and the manner in which the calls may be
accessed, will be made available shortly.
    The combined company, which will be called AbitibiBowater Inc., will
produce a wide range of newsprint and commercial printing papers, market pulp
and wood products. It will be the eighth largest pulp and paper manufacturer
in the world. Following the required divestiture, AbitibiBowater will own or
operate 31 pulp and paper facilities and 35 wood product facilities located in
the United States, Canada, the United Kingdom and South Korea. It will also be
among the world's largest recyclers of newspapers and magazines, and will have
more third-party certified sustainable forest land than any other company in
the world. The new company's shares will trade under the stock symbol ABH on
both the New York Stock Exchange and the Toronto Stock Exchange.

    About Abitibi-Consolidated Inc.

    Abitibi-Consolidated is a global leader in newsprint and commercial
printing papers as well as a major producer of wood products, serving clients
in some 70 countries from its 45 operating facilities. Abitibi-Consolidated is
among the largest recyclers of newspapers and magazines in North America,
diverting annually approximately 1.7 million tonnes of paper from landfills,
and is an industry leader in Canada in terms of forest certification.

    About Bowater Incorporated

    Bowater is a leading producer of coated and specialty papers and
newsprint. In addition, the company sells bleached market pulp and lumber
products. Bowater has 12 pulp and paper mills in the United States, Canada and
South Korea. In North America, it also operates one converting facility and
owns 9 sawmills. Bowater's operations are supported by approximately
708,000 acres of timberlands owned or leased in the United States and Canada
and 28 million acres of timber cutting rights in Canada. Bowater operates six
recycling plants and is one of the world's largest consumers of recycled
newspapers and magazines.

    Forward-Looking Statements

    Any statements made regarding the proposed combination between
Abitibi-Consolidated Inc. and Bowater Incorporated, the expected timetable for
completing the combination, benefits or synergies of the combination, and
other statements contained in this news release that are not historical fact
are forward-looking statements that are based on management's beliefs, certain
assumptions and current expectations. These statements may be identified by
the use of forward-looking terminology such as the words "expects,"
"projects," "believes," "anticipates" and other terms with similar meaning
indicating possible future events or actions or potential impact on the
businesses of Abitibi-Consolidated and Bowater. Such statements include, but
are not limited to, statements about future synergies expected from the
combination and benefits to the companies' stakeholders. This news release
also includes information that has not been reviewed by either company's
independent auditors. All forward-looking statements in this news release are
expressly qualified by information contained in each company's filings with
regulatory authorities.
    The following factors, among others, could cause actual results to differ
materially from those set forth in the forward-looking statements: the risk
that the businesses will not be integrated successfully; the risk that the
cost savings and other expected synergies from the combination may not be
fully realized or may take longer to realize than expected; difficulty
accessing the capital markets on terms favorable to the new company and
refinancing the new company's debt as it comes due and disruption from the
combination making it more difficult to maintain relationships with customers,
employees or suppliers. Additional factors that could cause
Abitibi-Consolidated's and Bowater's results to differ materially from those
described in the forward-looking statements can be found in the periodic
reports filed by Abitibi-Consolidated and Bowater with the SEC and the
Canadian securities regulatory authorities and available at the SEC's internet
site (http://www.sec.gov) and on SEDAR (http://www.sedar.com). Neither
Abitibi-Consolidated nor Bowater undertakes and each specifically disclaims,
any obligation to update or revise any forward-looking information, whether as
a result of new information, future developments or otherwise.

For further information:

For further information: Parties interested in the Snowflake mill and
related assets should contact directly: Jeff Drummond, Managing Director,
Scotia Capital Inc., (514) 287-3630; Investors: Francesco Alessi,
Vice-President, Investor Relations and Taxation, Abitibi-Consolidated, (514)
394-2341, falessi@abitibiconsolidated.com; Investors: Duane A. Owens, Vice
President and Treasurer, Bowater, (864) 282-9488; Media: Seth Kursman, Vice
President, Communications and Government Affairs Abitibi-Consolidated, (514)
394-2398, seth_kursman@abitibiconsolidated.com; Media: Kathleen M. Bennett,
Vice President - Government Affairs, Communications and Environment, Bowater,
(864) 282-9452, bennettkm@bowater.com

Organization Profile


More on this organization


More on this organization

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890