Montreal, Quebec, Canada, 27 May 2011 -- /CNW Telbec/ -- AbitibiBowater (NYSE: ABH) (TSX: ABH) announced today the closing of the sale of its 75% indirect interest in ACH Limited Partnership (ACH LP) to a consortium formed by a major Canadian institutional investor and a private Canadian renewable energy company.
"With the sale of our interest in ACH LP, the company is able to pay off a considerable amount of debt and further improve our financial flexibility. We will continue to focus on reducing AbitibiBowater's debt, and this represents an important step forward in line with our commitment," stated Richard Garneau, president and chief executive officer.
As previously announced, cash proceeds for AbitibiBowater's 75% indirect interest will amount to approximately CAD 300 million, CAD 185 million of which the company intends to use to redeem a portion of outstanding 10.25% senior secured notes due 2018, while the balance of proceeds will be used for general corporate purposes. As part of the transaction, ACH LP will maintain its outstanding debt with the Caisse de dépôt et placement du Québec, with a face value of CAD 250 million.
AbitibiBowater is a global leader in the forest products industry, producing a diverse range of products, including newsprint, commercial printing papers, market pulp, and wood products. The company owns or operates 18 pulp and paper mills and 24 wood products facilities in the United States, Canada, and South Korea. Marketing its products in close to 90 countries, AbitibiBowater is also among the largest recyclers of old newspapers and magazines in North America, 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.