Level playing field re-established
MONTREAL, March 9, 2012 /CNW Telbec/ - Fibrek Inc. ("Fibrek" or the "Corporation") announced today that the Court of Québec has overturned on appeal the decision of the Bureau de décision et de révision (Québec) granting an order to cease trade the proposed private placement (the "Private Placement") of 32,320,000 special warrants to purchase common shares of Fibrek to Mercer International Inc. ("Mercer") further to an application filed by AbitibiBowater Inc. (doing business as Resolute Forest Products) ("Abitibi").
Fibrek anticipates closing of the Private Placement to occur as soon as practicable upon receipt of all necessary regulatory approvals. The Private Placement is subject to the approval of the Toronto Stock Exchange.
The Board of Directors continues to unanimously recommend that shareholders ACCEPT and TENDER their common shares to Mercer's $1.30 offer and to REJECT and NOT TENDER their common shares to Abitibi's unsolicited $1.00 insider bid. If shareholders have tendered their shares to the Abitibi insider bid, the Board recommends that they WITHDRAW them immediately.
Commenting on the Court of Québec's decision, Hubert T. Lacroix, Chairman of the Board of Directors of Fibrek stated: "We are pleased that the Court of Québec has preserved the fundamental right of all Fibrek shareholders to benefit from the best available offer for their investment in Fibrek. With the special warrants back in place, a level playing field is once again re-established. The superior Mercer offer represents a 30% premium over Abitibi's insider bid and only requires that 50.1% of common shares be tendered, including the common shares issuable upon the exercise of the special warrants. The Board strongly urges shareholders to tender to this superior offer."
Pierre Gabriel Côté, President and Chief Executive Officer added: "We are very pleased that Fibrek minority shareholders have been heard and that they can now benefit from a superior offer. The Mercer offer provides shareholders with the opportunity to continue to participate in the future of an industry leading producer of market pulp with a similar culture of operational excellence to Fibrek's."
The Support Agreement, the Special Warrant Agreement and the Directors' Circular in respect of the Mercer offer have been filed and are available at www.sedar.com under the company's profile.
For more information on how to tender Fibrek Common Shares or for any other inquiries regarding the Mercer offer, please contact Fibrek's information agent, Phoenix Advisory Partners, at 1-800-398-1129 (North American Toll Free) or via email at [email protected].
Fibrek (TSX: FBK) is a leading producer and marketer of high-quality virgin and recycled kraft pulp. The company operates three mills located in Saint-Félicien, Québec, Fairmont, West Virginia, and in Menominee, Michigan with a combined annual production capacity of 760,000 tonnes. Fibrek has approximately 500 employees. The Saint-Félicien mill provides northern bleached softwood kraft pulp (product known as NBSK pulp) to various sectors of the paper industry mainly in Canada, the United States and Europe, for use in the production of specialized products. The Fairmont and Menominee mills manufacture air-dried recycled bleached kraft pulp (product known as RBK pulp) and primarily supply manufacturers of fine uncoated paper, tissue paper for commercial and industrial uses, and coated paper in the United States.
This press release contains "forward-looking statements" within the meaning of applicable securities laws. These statements can be identified by expressions of belief, expectation or intention, as well as those statements that are not historical facts and include statements concerning Fibrek's future outlook, business strategy, plans, expectations, results or actions, or the assumptions underlying any of the foregoing. Forward-looking statements can generally be identified by words such as "may", "should", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect", "outlook" and similar expressions. These statements are based on information currently available to Fibrek's management and on the current assumptions, intentions, plans, expectations and estimates of Management regarding Fibrek's future growth, results of operations, performance, business prospects and opportunities and ability to attract and retain customers as well as the economic environment in which it operates. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors which could cause actual results of Fibrek to differ materially from the conclusion, forecast or projection stated in such forward-looking statements. These risks, uncertainties and other factors include, but are not limited to: actions taken by Abitibi or Mercer, actions taken by shareholders of Fibrek in respect of Abitibi's unsolicited offer and the Mercer Offer, the possible effect of Abitibi's unsolicited offer and the Mercer Offer on Fibrek's business, the award of a power purchase agreement to Fibrek under the new Québec Government cogeneration program, general economic conditions, pulp prices and sales volume, exchange rate fluctuations, cost and supply of wood fibre, wastepaper and other raw materials, pension contributions, competitive markets, dependence upon key customers, increased production capacity, equipment failure, disruptions of production, capital requirements and other factors referenced in Fibrek's continuous disclosure filings which are available on SEDAR at www.sedar.com. The completion of the Mercer Offer is subject to a number of terms and conditions. The conditions to the Mercer Offer may not be satisfied in accordance with their terms, and/or Mercer may exercise its termination rights under the support agreement, in which case the Mercer Offer could be terminated. The outcome of the appeal of the BDR decision may also have an impact on the completion of the Mercer Offer. Failure to complete the Mercer Offer could have a material adverse impact on the market price of Fibrek's shares. Readers should not place undue reliance on these forward-looking statements. These forward-looking statements are made as of the date of this press release and, except as required by applicable securities laws, Fibrek assumes no obligation to update or revise them to reflect new events or circumstances.
For further information:
Vice President and Chief Financial Officer
NATIONAL Public Relations
Vice President, Change Management and Supply Chain