MONTREAL, Canada--March 13, 2009--/PRNewswire-FirstCall/ -- AbitibiBowater Inc. today announced it has signed a non-binding agreement in principle with Hydro-Quebec for the sale of its 60 percent interest in the hydroelectric facility located on the Manicouagan River (the "Facility"), for gross proceeds of C$615 million. Both parties have committed to an expedited timeline, consistent with the Company's comprehensive recapitalization plan also announced today. Due diligence for this transaction is currently under way.
The Facility, located in Quebec, Canada, was established in 1949 and has the capacity to generate approximately 335 MW of electricity. AbitibiBowater, through its Abitibi-Consolidated Company of Canada subsidiary, owns a 60 percent interest in the Facility.
"This transaction is a key step in AbitibiBowater's overall plan to ensure greater liquidity and financial flexibility," stated David J. Paterson, President and Chief Executive Officer. "Deleveraging the Company's balance sheet is important to all AbitibiBowater stakeholders."
The non-binding proposal for the sale of AbitibiBowater's 60 percent interest in the Facility is subject to certain terms and conditions, including, but not limited to, satisfactory due diligence, obtaining the required consents and approvals, the execution of definitive agreements (including a long-term power supply agreement for AbitibiBowater's Baie-Comeau, Quebec paper mill) and other customary conditions. No assurances can be provided as to when or if definitive agreements will be executed.
The proposal does not include the sale of the Baie-Comeau mill, nor does it in any way impact other Company hydroelectric facilities. Since last year, significant progress has been made in lowering the Baie-Comeau mill's operating costs and improving its highly competitive cost position. Given this transaction, the Company is committed to undertake new investment opportunities at the site. AbitibiBowater has and will continue to keep workers and local communities informed about the sale of its interest in the Facility as the process advances.
The Company owns additional hydro assets, including an installed share of capacity of 162.5 MW in the province of Quebec.
AbitibiBowater produces a wide range of newsprint, commercial printing papers, market pulp and wood products. It is the eighth largest publicly traded pulp and paper manufacturer in the world. AbitibiBowater owns or operates 24 pulp and paper facilities and 30 wood products facilities located in the United States, Canada, the United Kingdom and South Korea. Marketing its products in more than 90 countries, the Company is also among the world's largest recyclers of old newspapers and magazines, and has third-party certified 100% of its managed woodlands to sustainable forest management standards. AbitibiBowater's shares trade under the stock symbol ABH on both the New York Stock Exchange and the Toronto Stock Exchange.
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The Facility, located in Quebec, Canada, was established in 1949 and has the capacity to generate approximately 335 MW of electricity. AbitibiBowater, through its Abitibi-Consolidated Company of Canada subsidiary, owns a 60 percent interest in the Facility.
"This transaction is a key step in AbitibiBowater's overall plan to ensure greater liquidity and financial flexibility," stated David J. Paterson, President and Chief Executive Officer. "Deleveraging the Company's balance sheet is important to all AbitibiBowater stakeholders."
The non-binding proposal for the sale of AbitibiBowater's 60 percent interest in the Facility is subject to certain terms and conditions, including, but not limited to, satisfactory due diligence, obtaining the required consents and approvals, the execution of definitive agreements (including a long-term power supply agreement for AbitibiBowater's Baie-Comeau, Quebec paper mill) and other customary conditions. No assurances can be provided as to when or if definitive agreements will be executed.
The proposal does not include the sale of the Baie-Comeau mill, nor does it in any way impact other Company hydroelectric facilities. Since last year, significant progress has been made in lowering the Baie-Comeau mill's operating costs and improving its highly competitive cost position. Given this transaction, the Company is committed to undertake new investment opportunities at the site. AbitibiBowater has and will continue to keep workers and local communities informed about the sale of its interest in the Facility as the process advances.
The Company owns additional hydro assets, including an installed share of capacity of 162.5 MW in the province of Quebec.
AbitibiBowater produces a wide range of newsprint, commercial printing papers, market pulp and wood products. It is the eighth largest publicly traded pulp and paper manufacturer in the world. AbitibiBowater owns or operates 24 pulp and paper facilities and 30 wood products facilities located in the United States, Canada, the United Kingdom and South Korea. Marketing its products in more than 90 countries, the Company is also among the world's largest recyclers of old newspapers and magazines, and has third-party certified 100% of its managed woodlands to sustainable forest management standards. AbitibiBowater's shares trade under the stock symbol ABH on both the New York Stock Exchange and the Toronto Stock Exchange.">
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