Click here for Pulp & Paper Radio International
The Paperitalo Library
Free Downloads
My Profile
AbitibiBowater Announces Private Debt Exchange Offer for $496 Million of Debt Securities
Montreal, Quebec, Canada, 10 March 2008 -- /PRNewswire/ -- AbitibiBowater Inc. (ABH) announced today the commencement of private offers to exchange any and all of the following notes (the "old notes") in a private placement for a combination of cash and new 15.0% Senior Notes due 2010 (the "new notes") to be issued by Abitibi-Consolidated Company of Canada (ACCC).

Old notes include:
- 6.95% Senior Notes due 2008 of Abitibi-Consolidated Inc. (ACI), a
wholly-owned subsidiary of ABH;
- 5.25% Senior Notes due 2008 of ACCC, a wholly-owned subsidiary of
ACI; and
- 7.875% Senior Notes due 2009 of Abitibi-Consolidated Finance L.P.
(ACF), a wholly-owned subsidiary of ACI.

The exchange offers are being made only to qualified institutional buyers and institutional accredited investors inside the United States and to certain non-U.S. investors located outside the United States (eligible holders).

Each exchange offer will expire at 11:59 p.m. Eastern Time on 04 April 2008, unless extended. Eligible holders who validly tender and do not withdraw their old notes on or before 5:00 p.m. Eastern Time on March 26, unless extended (the "consent payment deadline"), will also receive additional cash payments in lieu of a portion of the new notes.

The cash to be paid and principal amount of new notes to be issued to eligible holders for each $1000 principal amount, or principal amount at maturity, as applicable, of old notes accepted in exchange as well as the cash to be paid to eligible holders who validly tender their old notes on or prior to the consent payment deadline is set forth in the table below.

The company is also soliciting consents to amend the supplemental indentures governing the old notes and agreement from the holders of the old notes not to exercise any remedies under the old notes or their respective supplemental indentures until 08 April 2008.

Consideration per $1000 principal amount
of old notes exchanged
If tendered If tendered
by the Consent after the Consent
Payment Deadline Payment Deadline
Principal Principal
amount amount
Title of Aggregate of new of new
old notes principal notes notes
to be CUSIP amount to be Cash to be Cash
exchanged # outstanding issued payment issued payment
6.95% 003924AA5 $195,612,000 $500.00 $500.00 $600.00 $400.00
5.25% 003669AB4 $150,000,000 $500.00 $500.00 $600.00 $400.00
7.875% 003672AA0 $150,000,000 $750.00 $250.00 $850.00 $150.00

The purpose of these private exchange offers is to improve ABH's financial flexibility by extending the maturities of its overall indebtedness and reducing the amount of its outstanding indebtedness with maturities in 2008 and 2009.

Tendered old notes may be validly withdrawn at any time before 5:00 p.m., Eastern Time, on 26 March 2008. Old notes tendered after the consent payment deadline may not be withdrawn.

Each of the exchange offers is conditioned upon, among other things, there being validly tendered and not withdrawn before the expiration of the exchange offers at least 90% principal amount of each series of old notes tendered into the exchange.

ACCC will enter into a registration rights agreement pursuant to which it will agree to file an exchange offer registration statement with the Securities and Exchange Commission with respect to the new notes.

The new notes will be senior unsecured obligations of ACCC, and will be guaranteed by ACI and ACF (they will not be guaranteed by ABH), ranking equal in right of payment with old notes not tendered in the exchange offers. The new notes will mature on 15 July 2010, and will bear interest at a rate per annum equal to 15.0%. Interest on the new notes will be payable on 15 July and 15 January of each year, beginning on 15 July 2008. The other terms of the new notes will be substantially similar to the terms of the 5.25% Senior Notes due 2008 of ACCC, except that the new notes will be guaranteed by ACI and certain subsidiaries and affiliates of ACI. The new notes have not been and will not be registered under the Securities Act or any state securities laws, may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements, and will therefore be subject to substantial restrictions on transfer.

About AbitibiBowater

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. Following the required divestiture agreed to with the U.S. Department of Justice, AbitibiBowater will own or operate 27 pulp and paper facilities and 35 wood products facilities located in the United States, Canada, the United Kingdom, and South Korea. Marketing its products in more than 90 countries, AbitibiBowater is also among the world's largest recyclers of newspapers and magazines, and has more third-party certified sustainable forest land than any other company in the world. AbitibiBowater's shares trade under the stock symbol ABH on both the New York Stock Exchange and the Toronto Stock Exchange.

Source: AbitibiBowater Inc.

Related Articles:

Powered by Bondware
News Publishing Software

The browser you are using is outdated!

You may not be getting all you can out of your browsing experience
and may be open to security risks!

Consider upgrading to the latest version of your browser or choose on below: