MONTREAL, April 1, 2012 /CNW Telbec/ - Following the announcement made on March 31, 2012 by Steelhead Partners, LLC and its affiliates ("Steelhead"), Fibrek Inc. ("Fibrek" or the "Corporation") understands that Steelhead intends not to tender any of its Fibrek shares to the unsolicited insider bid made by AbitibiBowater Inc. (doing business as Resolute Forest Products) ("Abitibi") until the minimum tender condition contained in the Abitibi bid has been met. Steelhead is the second largest shareholder of Abitibi. As at March 31, 2012, Steelhead represented that it held a total of 6,479,000 Fibrek shares, representing approximately 4.98% of the outstanding Fibrek shares.
Fibrek reminds shareholders that 46.4% of Fibrek shares are subject to lock-up agreements in favour of Abitibi, which expire on April 13, 2012. As of March 20, 2012, the only Fibrek shares tendered to the Abitibi unsolicited insider bid were the 46.4% of shares subject to the lock-up agreements, which do not represent a sufficient number of shares for Abitibi to meet its minimum tender condition. Accordingly, shareholders are urged to continue to not take any action with respect to their Fibrek shares in order to benefit from the superior $1.30 Mercer offer.
The Mercer offer at $1.30 was launched on February 29, 2012 and will remain open until 5:00 p.m. (Eastern Time) on April 6, 2012. Mercer has the obligation to extend the Mercer offer to a date that is at least 3 business days later than either (i) any extended expiry date of the Abitibi unsolicited insider bid, or (ii) the date at which the lock-up agreements in favour of Abitibi terminate in accordance with their terms.
The Board of Directors continues to unanimously recommend that shareholders ACCEPT and TENDER their common shares to Mercer's $1.30 offer.
The Board also recommends that shareholders REJECT and NOT TENDER their common shares to Abitibi's $1.00 unsolicited insider bid. If shareholders have tendered their shares to the Abitibi insider bid, the Board recommends that they WITHDRAW them immediately.
The Support 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. 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:
Patsie Ducharme 514 871-0550
Vice President and Chief Financial Officer
Lyla Radmanovich 514 843-2336
NATIONAL Public Relations
Dany Paradis 514 871-0550
Vice President, Change Management and Supply Chain