ABH (TSX, NYSE)
    US$

    MONTREAL, March 7 /CNW Telbec/ - AbitibiBowater Inc. announced today that
it has developed a refinancing plan to address upcoming debt maturities and
general liquidity needs of its Abitibi-Consolidated Inc. subsidiary.
AbitibiBowater expects that this refinancing plan will adequately address its
upcoming liquidity needs at Abitibi-Consolidated and will provide sufficient
financial flexibility to realize the benefits associated with an improving
business and operating environment. The refinancing plan of approximately
US$1.4 billion consists of:- US$200-300 million of new senior unsecured exchange notes of Abitibi-
        Consolidated Inc. due 2010,

      - US$400-500 million of new 364-day senior secured term loan of
        Abitibi-Consolidated Inc. secured by working capital and other
        assets,

      - Approximately US$400 million of new senior secured notes or a term
        loan due 2011 of Abitibi-Consolidated Inc. secured by fixed assets,
        and

      - US$200-300 million of new equity or equity-linked securities of
        AbitibiBowater Inc.AbitibiBowater's subsidiary, Abitibi-Consolidated, intends to promptly
commence an exchange offer targeting approximately US$500 million of its near
term maturities. This combination of new financings and exchange notes is
aimed at retiring the 6.95% Notes of Abitibi-Consolidated due April 1, 2008,
the 5.25% Notes of Abitibi-Consolidated Company of Canada due June 20, 2008
and the 7.875% Notes of Abitibi-Consolidated due August 1, 2009. Under the
terms of the exchange offer, holders will be offered a combination of cash and
new senior unsecured exchange notes of Abitibi-Consolidated due 2010. As part
of the transaction, certain credit facilities of Abitibi-Consolidated and its
subsidiaries are expected to be refinanced.
    With respect to its proposed 364-day term loan, Abitibi-Consolidated will
commence the marketing of the new loan and will be meeting with potential
lenders in New York City next week.
    As part of its refinancing plan, AbitibiBowater will be seeking an
amendment to the existing revolving credit facility of its Bowater
Incorporated subsidiary to allow for, among other things, the potential
issuance of new equity-linked securities of AbitibiBowater and a delay or
modification to Bowater's planned separation of its Catawba, South Carolina
coated paper facility. In this regard, AbitibiBowater no longer expects its
Bowater subsidiary to pursue a secured debt financing against the Catawba
facility at the present time.
    The sale of Abitibi-Consolidated's Snowflake, Arizona mill, originally
announced in February, is currently expected to close in mid-April.  The sale
is expected to result in US$161 million of cash proceeds.  AbitibiBowater
believes the sale of its Snowflake mill marks an important step in its efforts
to achieve its previously announced target of US$500 million in asset sales.
In addition, AbitibiBowater confirmed today that it is actively exploring
other non-core asset sales to generate additional liquidity and further
enhance its financial flexibility.
    There can be no assurance that the refinancing plan described in this
press release will be executed in the amounts and in the timeframe required to
address Abitibi-Consolidated's needs, if at all. The current state of the
credit and capital markets may create a significant impediment to
Abitibi-Consolidated's financing efforts as well as the overall financing
efforts of its parent, AbitibiBowater. If Abitibi-Consolidated is unable to
refinance or restructure its near-term debt maturities that are targeted by
the refinancing plan described in this press release on or before their
maturities, Abitibi-Consolidated would be in default under the indentures
relating to those notes and may be compelled to seek bankruptcy protection
under applicable law, which may negatively impact or disrupt the operations of
AbitibiBowater and its other principal subsidiary, Bowater Incorporated.
    This press release is neither an offer to purchase nor a solicitation of
an offer to sell any securities. One or more classes of new securities to be
offered as part of the refinancing package have not been and may not be
registered under the Securities Exchange Act of 1933 and, as such, may not be
offered or sold in the United States absent registration or an applicable
exemption from registration requirements.

    About AbitibiBowater

    AbitibiBowater produces a wide range of newsprint and commercial printing
papers, market pulp and wood products. It is the eighth largest publicly
traded pulp and paper manufacturer in the world. Following the required
divestiture agreed to with the U.S. Department of Justice, AbitibiBowater will
own or operate 27 pulp and paper facilities and 35 wood products facilities
located in the United States, Canada, the United Kingdom and South Korea.
Marketing its products in more than 90 countries, AbitibiBowater is also among
the world's largest recyclers of newspapers and magazines, and has more
third-party certified sustainable forest land than any other company in the
world. AbitibiBowater's shares trade under the stock symbol ABH on both the
New York Stock Exchange and the Toronto Stock Exchange.

    Forward-Looking Statements

    Statements in this press release that are not reported financial results
or other historical information are "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995. They include,
for example, statements about AbitibiBowater's and Abitibi-Consolidated's
refinancing plans, the terms of the securities and lending arrangements that
may be entered into under such plans and the timeframe for completing various
asset sales, including the sale of Abitibi-Consolidated's Snowflake, Arizona
mill. Forward-looking statements may be identified by the use of
forward-looking terminology such as the words "expect," "plans," "may,"
"will," and other terms with similar meaning indicating possible future events
or potential impact on the business or other stakeholders of AbitibiBowater
and its subsidiaries.
    The reader is cautioned not to place undue reliance on these
forward-looking statements, which are not guarantees of future performance.
These statements are based on management's current assumptions, beliefs and
expectations, all of which involve a number of business risks and
uncertainties that could cause actual results to differ materially. These
risks and uncertainties include, but are not limited to, the ability to obtain
additional new financing on terms satisfactory to AbitibiBowater and
Abitibi-Consolidated or at all, the condition of the U.S. credit markets
generally and worsening industry conditions. Additional factors are detailed
from time to time in AbitibiBowater's filings with the Securities and Exchange
Commission (SEC) and the Canadian securities regulatory authorities, including
those factors contained in the AbitibiBowater's Quarterly Report on From 10-Q
for the quarterly period ended September 30, 2007 and in the AbitibiBowater's
registration statement on Form S-3 filed with the SEC on October 29, 2007,
each under the caption "Risk Factors." All forward-looking statements in this
news release are expressly qualified by information contained in the
AbitibiBowater's filings with the SEC and the Canadian securities regulatory
authorities. AbitibiBowater disclaims any obligation to update or revise any
forward-looking information.