AbitibiBowater Exits Bankruptcy in U.S. and Canada
MONTREAL—AbitibiBowater has successfully completed its reorganization and emerged from creditor protection under the Companies’ Creditors Protection Act (CCAA) in Canada and Chapter 11 of the U.S. Bankruptcy Code.
“Through our restructuring efforts, we have transformed this organization and given AbitibiBowater a new future—one driven by a company-wide commitment to profitability and sustainability,” stated David Paterson, president and CEO. “By strengthening our competitiveness and dramatically improving our financial position, AbitibiBowater has become one of the lowest cost forest products companies in North America. We are now a leaner, more flexible organization with a balanced product portfolio, better able to create value for our stakeholders while responding to the challenges of a tough industry with ongoing market volatility.”
Since 2007, the company has restructured itself both financially and operationally in a way that has dramatically lowered its break-even point, having:
• Streamlined its asset profile to top-performing facilities, closing or idling 3.4 million metric tons of paper capacity on an annual basis. This represents capacity reductions of 41 percent for newsprint and 32 percent for commercial printing papers. Wood products capacity was reduced by 21 percent over the same period.
• Balanced its portfolio of products, reducing exposure to any one grade. Among the new production capacities on an annual basis are 3.3 million metric tons for newsprint and 2.5 million metric tons for commercial printing papers.
• Developed a flexible mill portfolio with a mix of U.S., Canadian and international mills located strategically to efficiently serve customers, supporting low-cost, on-time delivery and providing a natural currency hedge as well as the ability to adapt to changing market dynamics.
• Completed a strategic review and sold non-core assets and land holdings for total aggregate proceeds of more than $940 million.