Montreal, Quebec, Canada, 14 February 2011 -- /CNW Telbec/ -- AbitibiBowater announced today that it will permanently close its paper machine at its Coosa Pines, Alabama, USA, operation and cease its pilot project to manufacture recycled lightweight and ultra lightweight packaging and linerboard grades within the next 30 days. AbitibiBowater remains committed to its fluff pulp assets at the facility.

“Coosa Pines has made progress in the production of recycled lightweight and ultra lightweight packaging and linerboard. Upon review, however, the substantial capital investment that would be required at the site to make it low-cost in these grades could not be justified,” said Richard Garneau, president and chief executive officer.

The company estimates it will incur cash closure costs of approximately USD 4 million related to severance and other closure charges as a result of the permanent closure of the paper machine at the Coosa Pines mill. The majority of these closure costs will be paid during the first half of 2011. A noncash asset charge of approximately USD 10 million will be taken to reflect this permanent closure. Approximately 150 employees are affected by this closure.

“The decision to cease paper production at the Coosa Pines mill was difficult as we are mindful of the impact it will have on affected employees,” added Garneau. “The company also remains committed to customer service and delivery of high-quality products and will work closely with customers to ensure a smooth transition.”

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 more than 70 countries, AbitibiBowater also is 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.