Abitibi-Consolidated: Dealer group to solicit proxies in favor of Bowater merger

By Lisa Kerner

Charlotte, N.C., July 18 - Abitibi-Consolidated Inc. amended its agreement with CIBC World Markets Inc. allowing CIBC to also act as soliciting dealer in connection with the upcoming special meeting of Abitibi-Consolidated shareholders on July 26.

CIBC will form and manage a soliciting dealer group to solicit proxies from Canadian retail shareholders to approve the proposed merger with Bowater Inc., according to a company news release.

Members of the soliciting dealer group will be paid $0.03 per Abitibi-Consolidated common share owned by Canadian retail shareholders for each proxy voted in favor of the deal. A minimum fee of $85.00 and a maximum fee of $1,500.00 will be paid for any one holder of a minimum of 1,500 shares.

As previously reported, under the companies' merger agreement each common share of Abitibi-Consolidated will be exchanged for 0.06261 of a common share of the newly formed company, AbitibiBowater Inc. Each Bowater common share will be exchanged for 0.52 of a common share of AbitibiBowater. A $28 million termination fee is included in the agreement.

Bowater stockholders will vote at their company's annual meeting, also scheduled for July 26, while Bowater Canada Inc. will hold a special meeting in connection with the merger on July 25.

Based in Montreal, Abitibi-Consolidated provides newsprint, commercial printing papers and wood products. Bowater produces coated and specialty papers and newsprint in Greenville, S.C.

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