Business News
ABITIBIBOWATER TO PROTECT INTERESTS IN NEWFOUNDLAND EXPROPRIATION
Thursday 18. December 2008 - AbitibiBowater announced today that it will consider all options available to protect the interests of its stakeholders in the expropriation of its provincial assets and contractual rights to natural resources by the government of Newfoundland and Labrador, Canada.
In a statement Tuesday, Premier Danny Williams said the government would expropriate provincial assets, excluding the Grand Falls paper mill, as well as all water and land rights to the public and private forestlands AbitibiBowater manages in the province. The Williams government also indicated the Company may be paid for its hydro assets with the expropriation but no commitment has been made to ensure AbitibiBowater obtains proceeds representing the full value of these operations.
“We are surprised by this course of action, especially given that this unprecedented expropriation of property rights and assets does not address the announced closure of the Grand Falls mill and the needs of its 750 employees,” stated David J. Paterson, President and Chief Executive Officer. “We have reiterated to the government of Newfoundland and Labrador our intention to discuss the disposal of our assets and rights in an orderly manner, while protecting the best interests of our shareholders, debt holders, employees and all other Company stakeholders.”
On December 15, 2008, AbitibiBowater responded to the recent government request to surrender Company rights and recommended setting up a joint working group to address issues related to the closure of the Grand Falls mill and the Company’s overall presence in the province. Given this most recent development, AbitibiBowater will review its options, including all legal recourses. The Company will also assess how these announced measures apply within the framework of U.S.-Canada trade relations.
The Company had previously announced the permanent closure of its Grand Falls facility by the end of the first quarter of 2009.