After weeks of uncertainty, publicly listed North American North American newsprint giant AbitibiBowater Inc. has c…
After weeks of uncertainty, publicly listed North American North American newsprint giant AbitibiBowater Inc. has come out swinging. In an attempt to stave off bankruptcy protection for its Abitibi Consolidated subsidiary, AbitibiBowater has put together a US$1.4-billon refinancing plan. One component of the plan will swap equity and cash for debt.
The refinancing plan comes on the heels of five days of unfruitful talks between Abitibi and its union after the union refused to agree to concessions. Montreal-based AbitibiBowater says the refinancing will address subsidiary Abitibi looming near-term debt maturities of about $500 million and general liquidity problems. That and give Abitibi enough flexibility to ensure it will take advantage of an improving industry and operating environment.
As well and because of the new financing plan, AbitibiBowater says it no longer expects Abitibi to pursue a secured-debt financing against the Catawba coated paper facility in South Carolina.
On Wall and Bay streets, the reaction to the refinancing plan was cautiously optimistic, one of many necessary steps to refinance the companys overall debt.
Print this page
