AbitibiBowater

February 9, 2009              

AbitibiBowater, the largest North American newsprint maker, is moving to exchange $1.8 billion of debt to push back maturities and selling new bonds to repay bank loans and avoid default. According to Bloomberg, as of Dec. 31, AbitibiBowater had a $347 million loan due March 30, $272 million under an accounts-receivable securitization program maturing in July, about $248 million of debentures due on Aug. 1, and another $234 million of securities that mature in March 2010, the company said in the filing.

            A private institutional investor has also entered into a note purchase agreement with Bowater to purchase $80 million of notes in a private placement. According to Reuters,  early in 2008, AbitibiBowater cut about 1 million tons of newsprint and specialty papers production in a bid to tackle a slump in demand. The company has since taken further measures to curtail production.

AbitibiBowater have in excess of $1 billion of maturities and repayment obligations that come due before the end of August 2009 and significant maturities that come due in 2010 and beyond.

Web Articles:

• UPDATE 2 - AbitibiBowater announces debt exchange offer

• AbitibiBowater Starts $1.8 Billion Debt-Swap Offer (Update 3)

• AbitibiBowater production ends in Grand Falls-Windsor