AbitibiBowater finalizes sale of Quebec hydro asset - for $615 million

AbitibiBowater has finalized a deal to sell its Manicouagan power plant for $615 million to a newly created joint venture formed by Hydro-Quebec and Alcoa Inc., the aluminum company.

This transaction represents the sale of AbitibiBowater's 60% interest in the 335-megawatt hydroelectric facility to the provincially owned public utility. Alcoa holds the remaining 40% interest.

Proceeds from the sale will be used in part to repay a US$100-million debtor-in-possession loan guaranteed by the Quebec government that comes due in November. The funds were provided by the Bank of Montreal.

AbitibiBowater will also enter into a long-term power supply agreement with Hydro Quebec's distribution division for the supply of electricity to Abitibi's mill in Baie-Comeau, Que.

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AbitibiBowater finalizes $615-million deal to sell Quebec hydro asset (The Canadian Press)