A (TSX) ABY (NYSE) MONTREAL, Nov. 17 /PRNewswire-FirstCall/ -- Abitibi-Consolidated Inc. announced today that it has completed the sale of its 50% share ownership in Pan Asia Paper Company Pte Ltd. to Norske Skog of Norway. Initially announced in September 2005, the transaction will generate a cash consideration of US$600 million plus a cash purchase price adjustment of up to US$30 million depending on the achievement of certain financial performance objectives in 2006. Additionally, the sale of PanAsia has removed US$300 million of debt from the Company's balance sheet. In total, this transaction will reduce Abitibi-Consolidated's net debt level by more than C$1 billion, compared to Q2 2005, significantly improving its balance sheet and liquidity position, as well as offer financial flexibility for the future. Divesting PanAsia also reflects a choice by the Company to sharpen its strategic focus on its North American portfolio of assets, where it has the most leverage to the current pricing environment and direct access to free cash flows. "The investment and partnership with Norske Skog was a win-win for the last 6 years. Today, we believe that full value has been realized and with a total return on investment of 83%, we believe that this was the right price at the right time," stated John Weaver, President and CEO. "Divesting PanAsia is not an end in itself. Rather, it represents the rebalancing of the portfolio of a less-levered Company that can grow and prosper over the long haul," added Weaver. Abitibi-Consolidated is a leading producer of newsprint and commercial printing papers as well as a major supplier of wood products, serving 70 countries from close to 50 operating facilities. Committed to the sustainable forest management of more than 40 million acres through third-party certification, the Company is also the largest recyclers of newspapers and magazines in North America. FORWARD-LOOKING STATEMENTS This disclosure contains certain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions in the U.S. and Canada and in countries in which the Company and its subsidiaries currently do business; industry conditions, the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in the availability or costs of raw materials or electrical power; changes in existing forestry regulations or changes in how they are administered which could result in the loss of certain contractual or other rights or permits which are material to the Company's business; increased competition; the lack of availability of qualified personnel or management; the outcome of certain litigation; labour unrest; and fluctuation in foreign exchange or interest rates. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits, including the amount of proceeds, that the Company will derive therefrom. DATASOURCE: ABITIBI-CONSOLIDATED INC. CONTACT: Financial Media: Seth Kursman, Vice President, Communications and Government Affairs, (514) 394-2398, ; Investors: Pierre Rougeau, Senior Vice-President, Corporate Development and Chief Financial Officer, (514) 394-2264,

Copyright