8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  December 17, 2008

ABITIBIBOWATER INC.

(Exact name of Registrant as Specified in Charter)

Delaware	001-33776	98-0526415
(State or other Jurisdiction of Incorporation or Organization)	(Commission File Number)	(I.R.S. Employer Identification Number)

AbitibiBowater Inc. 1155 Metcalfe Street, Suite 800 Montreal, Quebec Canada	H3B 5H2
(Address of principal executive offices)	(Zip Code)
(514) 875-2160
(Registrant's telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):  

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Item 7.01.	Regulation FD Disclosure.
	On December 22, 2008, AbitibiBowater Inc. (the "Company") issued guidance with respect to the Company's expected fourth quarter financial performance.  A copy of the press release is attached hereto as Exhibit 99.1.
	All of the information in Item 7.01 of this report, including the press release attached as Exhibit 99.1 hereto as it relates to the Company's fourth quarter expectations, is being "furnished" and shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise and shall not be incorporated by reference in any filing under the Securities Act of 1933, as amended, except to the extent expressly set forth by specific reference in such filing.
Item 8.01.	Other Information.
	On December 17, 2008, the Company issued a press release announcing that the Company will consider all options available to protect the interests of its stakeholders after the government of Newfoundland and Labrador, Canada said that it would expropriate provincial assets and all water and land rights to the public and private forestlands the Company manages in the province.  A copy of the press release is attached hereto as Exhibit 99.2.

On December 22, 2008, the Company issued a press release announcing that the Company has accepted a non-binding proposal for the sale of its equity interest in ACH Limited Partnership to a major industrial energy producer.  A copy of the press release is attached hereto as Exhibit 99.1.

Item 9.01	Financial Statements and Exhibits
	(d)	Exhibits.
		99.1	Press release issued by the Company on December 22, 2008.
		99.2	Press release issued by the Company on December 17, 2008.

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Signature

Pursuant to the requirements of the Securities Exchange Act of l934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	ABITIBIBOWATER INC.
	By:	/s/ Jacques P. Vachon
Date: December 22, 2008		Name: Jacques P. Vachon
		Title: Senior Vice-President Corporate Affairs and Chief Legal Officer

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release issued by the Company on December 22, 2008.
99.2	Press release issued by the Company on December 17, 2008.

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EX-99

Exhibit 99.1

PRESS RELEASE

ABH (NYSE, TSX)

US $

ABITIBIBOWATER ANNOUNCES SIGNING OF PROPOSAL

FOR SALE OF ONTARIO HYDRO ASSETS AND REAFFIRMS EXPECTATION OF SUBSTANTIAL IMPROVEMENT IN FOURTH QUARTER FINANCIAL RESULTS

MONTREAL, CANADA, December 22 , 2008 - AbitibiBowater Inc. today announced it has accepted a proposal for the sale of its equity interest in ACH Limited Partnership to a major industrial energy producer. ACH Limited Partnership was established to hold hydro-electric generating assets in Ontario, Canada by the Company's Abitibi-Consolidated Company of Canada subsidiary in April 2007. The Company owns a 75 percent equity interest in ACH Limited Partnership.

The proposal values the hydro assets, which have a combined capacity of 136.8 MW, at C$540 million. The resulting gross proceeds (excluding expenses) for AbitibiBowater would be C$197.5 million. As part of the transaction, the buyer would also assume C$250 million of ACH Limited Partnership's term debt.  

"The signing of this proposal marks continued progress with our de-leveraging initiatives, "stated David J. Paterson, President and Chief Executive Officer of AbitibiBowater. "We look forward to continued de-leveraging progress as we implement additional measures to improve our free cash flow generation."  

The non-binding proposal for the sale of the hydro-electric generating assets in Ontario is subject to due diligence, among other terms and conditions. While AbitibiBowater expects that a definitive agreement will be reached in the first quarter of 2009, no assurances can be provided as to when or if a definitive agreement will be executed.

The proposal does not include the sale of the Iroquois Falls or Fort Frances, Ontario mills. AbitibiBowater is pleased with the efforts both mills have made since the merger in lowering their costs. The mills remain competitive and the Company continues to look for investment opportunities to ensure that they remain competitive. AbitibiBowater is committed to keeping workers and local communities informed about the sale of ACH Limited Partnership as the process advances.

AbitibiBowater owns additional hydro assets, including an installed share of capacity of 363 MW in the Province of Quebec.

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Q4 2008 Expectations

AbitibiBowater Inc. today also announced that it is reaffirming its guidance of significant improvement in fourth quarter financial performance.  The Company expects its fourth quarter operating income, excluding gains on asset sales, impairments and mill closure and other related charges, to be in the range of $65 million to $95 million compared to a $9 million loss for the third quarter of 2008.  The Company also expects its earnings before interest, taxes, depreciation and gains on asset sales, impairments and mill closure and other related charges (Adjusted EBITDA) to be in the range of $245 million to $275 million for the fourth quarter of 2008.  For the third quarter of 2008, Adjusted EBITDA was $175 million. 

"This substantial improvement in the Company's operating performance is a result of our employees' efforts to achieve synergies as well as reductions in input costs," stated Paterson. "Our input costs, particularly energy and fiber, have declined dramatically this quarter.  We have also benefited from a weakening Canadian dollar.  Despite lower volumes, as evidenced by our production curtailments, we expect a substantial improvement in financial performance in 2009 compared to 2008". 

Use of Non-GAAP Measures

This press release includes references to operating income (loss) before special items and Adjusted EBITDA, which are not recognized measures under United States generally accepted accounting principles ("GAAP").  The Company provides these non-GAAP financial measures to assist investors in assessing the current performance of its core cash operations in the same manner that management evaluates these operations. The Company believes these measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies like AbitibiBowater, with substantial financial leverage.  However, these non-GAAP financial measures should not be considered as alternatives to cash flows from operations, as measures of liquidity or as alternatives to operating income (loss) or net income (loss), as indicators of the Company's operating performance or any other measures of performance in accordance with GAAP.  Readers are cautioned not to place undue reliance on these non-GAAP financial measures.   

Other companies may define operating income (loss) before special items and Adjusted EBITDA differently and, as a result, the Company's non-GAAP financial measures may not be directly comparable to those of other companies. The Company has determined that it is not practical to provide a reconciliation of the Company's forecasted operating income (loss) before special items and Adjusted EBITDA to the most directly comparable GAAP measures because certain items, such as impairments, mill closure and other related charges, cannot be reasonably estimated or predicted at this time.  

Operating income (loss) before special items is defined as operating income (loss) from the Company's consolidated statements of operations, excluding closure costs, impairment and other related charges, severance and merger-related costs, gains on

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dispositions of assets and other discretionary charges or credits.  A reconciliation of third quarter operating income (loss) before special items to GAAP operating income (loss) is included in the Company's November 6, 2008 earnings release for the third quarter, available on the Company's website.

Adjusted EBITDA is defined as EBITDA (net income (loss) before interest expense, interest income, income tax expense (benefit) and depreciation, amortization and cost of timber harvested) excluding gains on asset sales, impairments and mill closure and other related charges.

AbitibiBowater produces a wide range of newsprint, commercial printing papers, market pulp and wood products. It is the eighth largest publicly traded pulp and paper manufacturer in the world. AbitibiBowater owns or operates 25 pulp and paper facilities and 30 wood products facilities located in the United States, Canada, the United Kingdom and South Korea. Marketing its products in more than 90 countries, the Company is also among the world's largest recyclers of old 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 .

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Contacts

Investors                   Duane Owens  Vice President, Finance 864 282-9488 Media and Others Seth Kursman Vice President, Communications and Government Affairs 514 394-2398 seth.kursman@abitibibowater.com

Forward-Looking Statements

Statements in this news 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 the resulting gross proceeds of the sale for the Company, reaching a definitive agreement in the first quarter of 2009, developing a plan to mitigate the impact of the sale on our operations, expected earnings, improvements of our operating and financial performance, the continued momentum in our financial performance, our efforts to reduce costs, increase revenues and profitability, our assessments of market conditions, strategies, future plans, future sales, prices for our major products, inventory levels, capital spending, tax rates, and our business outlook and strategies for achieving our goals generally. Forward-looking statements may be identified by the use of forward-looking terminology such as the words "should," "would," "could," "may," "expect," "believe," "anticipate" and other terms with similar meaning indicating possible future events or potential impact on the business or stockholders of AbitibiBowater. 

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

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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, industry conditions generally and further growth in alternative media, the ability to finalize the ACH proposal on terms satisfactory to the Company within the announced time frame or at all, the prices under which the Company would be able to sell the assets, the ability to develop a plan to mitigate the sale of the hydro asset on mill operations, the impact of the global credit crisis on the Company's ability to meet its $1 billion debt reduction target, the Company's ability to divest assets on satisfactory terms, the Company's efforts to address its upcoming debt maturities, the Company's ability to refinance or amend the terms of its current indebtedness on satisfactory terms, the Company's ability to realize price increases, the Company's ability to obtain timely contributions to cost-reduction initiatives from unionized and salaried employees, the costs of raw materials such as energy, chemicals and fiber, the risk that the Company could fail to comply with NYSE continued listing requirements, which could result in immediate delisting of the Company's common stock, the risk that the Company could fail to achieve the financial projections set forth in this press release due to the foregoing factors and other unforeseen factors, and the success of the Company's continuing post-merger integration activities. 

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 Company's Annual Report on Form 10-K/A for the year ended December 31, 2007, filed with the SEC on March 20, 2008, and the Company's Quarterly Report on Form 10-Q for the period ended September 30, 2008, filed with the SEC on November 14, 2008, under the caption "Risk Factors" in each respective report. All forward-looking statements in this news release are expressly qualified by information contained in the Company's filings with the SEC and the Canadian securities regulatory authorities. AbitibiBowater disclaims any obligation to update or revise any forward-looking information.

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EX-99

Exhibit 99.2

PRESS RELEASE

US$

ABH (NYSE, TSX)

AbitibiBowater to Protect Interests in

Newfoundland Expropriation

MONTREAL, CANADA, December 17, 2008 - AbitibiBowater announced today that it will consider all options available to protect the interests of its stakeholders in the expropriation of its provincial assets and contractual rights to natural resources by the government of Newfoundland and Labrador, Canada. 

In a statement Tuesday, Premier Danny Williams said the government would expropriate provincial assets, excluding the Grand Falls paper mill, as well as all water and land rights to the public and private forestlands AbitibiBowater manages in the province. The Williams government also indicated the Company may be paid for its hydro assets with the expropriation but no commitment has been made to ensure AbitibiBowater obtains proceeds representing the full value of these operations.   

"We are surprised by this course of action, especially given that this unprecedented expropriation of property rights and assets does not address the announced closure of the Grand Falls mill and the needs of its 750 employees," stated David J. Paterson, President and Chief Executive Officer. "We have reiterated to the government of Newfoundland and Labrador our intention to discuss the disposal of our assets and rights in an orderly manner, while protecting the best interests of our shareholders, debt holders, employees and all other Company stakeholders." 

On December 15, 2008, AbitibiBowater responded to the recent government request to surrender Company rights and recommended setting up a joint working group to address issues related to the closure of the Grand Falls mill and the Company's overall presence in the province. Given this most recent development, AbitibiBowater will review its options, including all legal recourses. The Company will also assess how these announced measures apply within the framework of U.S.-Canada trade relations.

The Company had previously announced the permanent closure of its Grand Falls facility by the end of the first quarter of 2009. 

AbitibiBowater produces a wide range of newsprint, commercial printing papers, market pulp and wood products. It is the eighth largest publicly traded pulp and paper

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manufacturer in the world. AbitibiBowater owns or operates 25 pulp and paper facilities and 30 wood products facilities located in the United States, Canada, the United Kingdom and South Korea. Marketing its products in more than 90 countries, the Company is also among the world's largest recyclers of old 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.

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Contacts

Investors                   Duane Owens  Vice President, Finance 864 282-9488 Media and Others Seth Kursman Vice President, Communications and Government Affairs 514 394-2398 seth.kursman@abitibibowater.com

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