DBRS Downgrades Bowater Inc. and Subsidiary

DBRS has today downgraded the Issuer Rating of Bowater Inc. to D and the Senior Debentures rating of Bowater Canadian Forest Products Inc. to D following today’s announcement that AbitibiBowater Inc. (ABH or the Company) and certain of its U.S. and Canadian subsidiaries have filed voluntary petitions in the United States under Chapter 11 of the United States Bankruptcy Code (Chapter 11).

As well, AbitibiBowater and certain of its Canadian subsidiaries will seek creditor protection under the Companies Creditors Arrangement Act (CCAA) in Canada. The Company intends to file in Canada on April 17, 2009. AbitibiBowater’s subsidiaries located outside the United States and Canada have not commenced Chapter 11, CCAA or similar proceedings. DBRS has also removed the Bowater ratings from Under Review with Negative Implications, where they were originally placed on October 30, 2008. In keeping with DBRS policy, all recovery ratings assigned to the above mentioned companies are being discontinued given the rating action to D. (For information on DBRS recovery rating opinions prior to this, please see AbitibiBowater press release dated March 3, 2009.)

DBRS had previously downgraded the ratings on ABH and its subsidiaries, Abitibi-Consolidated Inc. and Abitibi-Consolidated Company of Canada to D on March 16, 2009, following an announcement that the Company had decided not to pay certain amounts of principal and interest on affected unsecured notes, secured notes and term loan that would be due before the meetings of noteholders and lenders scheduled for April 30, 2009. The rating action followed the Commercial Division of the Superior Court of Quebec in Montréal granting an interim court order under the Canada Business Corporations Act in connection with the Recapitalization by the Company announced on March 13, 2009. The downgrade to D was consistent with DBRS methodology.

Notes:
All figures are in U.S. dollars unless otherwise noted.
The ratings are based on public information.

The applicable methodology is rating the Forest Products Industry, which can be found on our website under Methodologies.

This is a Corporate Rating.